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The economics of tuberculosis control
2
T U B E R C L E SUPPLEMI'~NT
THE ECONOMICS
OF TUBERCULOSIS CONTROL
By Hays TH. WAALER fiom the Na:hmal Tuberculosis Register, Directorate of Health Services, Oslo
"Economics is not a popular subject among tuberculosis specialists or at tuberculosis conferences. But it is tile core of the problem of tuberculosis in Africa and the world.' This is a quotation from a leading article in the December issue of Tubercle last year. The unpopularity is probably caused by the apparent irrelevancy of the subject. It does not appeal to the chest physician. The economics of tuberculosis control is to him a distant problem to be dealt with by somebody else. I shall, tlowever, attempt to demonstrate that basic economic considerations ;ire continuously forced upon anybody who is in a position to ~ake any action at all. 1 shall in tile present paper concentrate on a few basic principles which are supposed to be paramount for understanding the cost-aspect pertaining to rational planning.of control programmes. It is important in this field, as in others, to have some kind of logical frame of reference for thinking and action. It is important to have a theoretical model which depicts the actual problem and interplay between action and result. The general situation is characterized as follows: (11 There exists a problem or an object which one would like to reduce or to achieve. (2) There is a budget or some resources for implementation. (3) It is realized that the reduction of the problem or the achievement of the object can be attained by alternative routes or by several combinations of various production factors. The actual programruing problem then consists of allocating the resources in such a way that one produc~s the largest problem-reduction for tie given budget. This is a general situation facing everyone of you at several stages and in several situations. The actual formal solution is one of mathematical programruing which can be dealt with by modern mathematical methods. The solution is in fact achieved when the marginal impact is tile same in all directions, because if this is not the case, it would pay to transfer some resources from one direction into another direction. Considering for a moment an example of a different nature, i.e. the problem of reaching the top of the mountain. One may define the event of having reached the top when, irrespective of which direction you proceed, you start to descend. This situation is analogous to the situation facing a government or parliament when they. through their tax-policy, decide upon alternative expenditures in the directio~ of collective expenditure and private expenditure of the national product. They are facing the same allocation problem when it comes to splitting the budget in the direction of health, education, communication, industry. defence etc., where spending resources in all directions is supposed to increase welfare, but where only one combination of these allocations is the one that will give maximum community welfare. And further down the ladder, the director of health services is facing an allocation problem between various diseases, how much to spend on tuberculosis, how much on disease A, how much on disease B, etc., trying to minimize morbidity and mortality in some way. The tuberculosis division of the directorate of health can spend resources and influence expenditures in various directions on casefinding, treatment, BCG-programmes, chemoprophylaxisem. The problem facing them is the same: allocation of resources to various production factors with a view to making the greatest impact on the problem. Finally, the clinician may be facing an analogous situation when allocating drugs to his patients. Now, if the general principle of solving such allocation problems were applied at the various
ECONOMICS
OF
TUBERCULOSIS
3
CONTROL
stages, simple considerations might give important and interesting conclusions for the actval programmer at the various levels. The total solution of these problems is complicated by, for instance, extensive interactions between the various factors and lack of information about the relationships, One does not know enough about the possible impact on various diseases, nor how to compare various outputs, nor is there enough detailed information about the actual long-term epidemiological impact of finding a case and of vaccinating a person etc.. But it is believed that realization of the problem and the general solution to it will help to achieve, if not an optimum allocation, a solution closer to the actual.optimum than one otherwise would have acilieved. Considering first the community problem of allocating resources in the direction of health, education, communication, industry etc. it is realized that there exists a very intimate interaction ~t
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TIME FIG. 1
l'he 'problcm' of two diseases (A. and B,) and the 'problem-reduction' (shaded area) obtainable at the cost of D, Di.~a~c A is a larger problem than B; but the reduction o f the problem is greater with disease B.
between, for instance, J'ealth and industry through economic development. Interactions exist I~tween education and industry through the necessity of having trainedpeople for economic development, and between health and education, as, of course, is well known. The realization of these interactions is paramount tbr rational community planning. Consider the problem facing the director of health services and the fight between various groups in tile allocation of resources to various diseases. A rational procedure would allocate resources in the direction of disease B (Fig, I) instead of A irrespective of the fact that A represents a larger problem and irregpective of the already more advantageous trend for disease B. This view has considerable consequences for the present allocation of resources to tuberculosis, particularly so in i lie developed countriesLet us then consider the analogous problem in the field of tuberculosis. Now, the general principle of allocation will automatically tell us that a programme in the field of tuberculosis does not consist of this or that action, but should always be considered as a combination of various factors to be balanced in an optimum way according to the principles uthned above. This means, for instance, the very important point that whether one should ha% BCG,vaccination in a programme or not does not depend on the fraction of the tuberculosis problem that can be dealt with by this particular measure. The relevant thing is the marginal impact, or rather the marginal epidemiological impact that one can obtain for a given amount of mo~tey, It is not a question of.whether BCG can produce 10~oor 90~o of the problem reduction, but how mucl~ problem reduction one can obtain with $I in the direction of BCG as compared with another direction. Considerable knowledge about this is, O
w
.
4
TUBER(:LE SU P PLI-~M t-NT
in fact, available. To return to the problem about allocation between the various diseases, the allocation should n o t depend upon the size of the problem posed by the disease. It should n o t depend upon the trend of the disease, but on/), on the potential impact on the problem that can be olbtained, which should be clear from the figure presented. Most important in this context is the interaction between tuberculosis and other ,sections in the community. The allocation of community resources in many developing countries to fertilizer factories will have an impact on the tuberculosis problem in an indirect way and might conceivably be more effective.than any specitic actions against this disease. The fact that this relationship is difficult to estimate.does not make it less important to bear in mind. Finally let us consider the problem for a clinician under restricted drug budget conditions. What lie tries to achieve with his budget is either tO minimize the suffering for the known paticnt~ or to minimize the epidemioloaical_ harm produczd now and in the future. In any ca, c"she is facing an allocation problem. He can for a given budget construct almost an intinitc number of drug regimens by varying the combinations of drugs used, the doses, the frequency of giving the drugs, the duration of treatment etc. And in principle there exists only one combination of these factors for a given budget that will produce minimum .,,t~tl'ering or n~inimunl cpidemiological harm. Fortunately for the clinicians, at this levcl a considerable amount of information is available which should make it possible to achieve the optimuna allocation. The allocation problem is a b-~sic economic problem. The achievement of an optimum allocation is not easy. Even when the solution is known theorclically, prestige and vested interests may prevent an optimum solution. However. the realization of the problem and at least in principle of the solution, might give considerable improvements in the planning process and in the actions taken.
SOME
E C O N O N I l C A S P E C T S O F T U B E R C U I . O S I S C O N T R O l , IN AI, GERIA By L. MO~CHTARI(with A. BENGHI:ZAI., P. CitAULET and D. LARI3AOUI) from the Bureau de la Lutte C'ontre la Ttaberculose, Algiers
Algeria has a population ol'about 12 million inhabitants i~ an area of 2,372,940 square kilometres. Tile average population density is therefore 5.1 inhabitants per" square kiiometre. There is however a great difference between the density in the north, which is fairly thickly populated with from 20 to 485 inhabitants per sq. kin.. and the south, which is desert and has only 0-3 to 0.4 inhabitznts per sq. km. Thus the public health problems are quite different'in dae north and in the south.
Public Itealth in/~lgeria Algeria is i'n a rather more fortunate position than marly African countries in terms of medical personnel, hospitals and clinics. With 1,390 doctors, 45,000 hospital beds, and 643 general clinics, Algeria has roughly I doctor per 8,600 inhabitants, 1 general clinic per 18,000 inhabitants, and 1 hospital bed per 270 inhabitants. These national averages do not give a true picture of the real situation, because there are far more doctors and hospitals in the towns than in the country areas or in the south'. The importance attatzhed to public health services in Algeria is reflected in the national budget. Since independence in 1962, the health budget has been, on average, about 300,000,000 DA p.a. This represents about 10~,,/, of governmental expenditure, and means that the State is spending, on public health services, about 25 DA per person p.a., or about $5 per person p.a.
T U B E R C L E SUPPLEMI'~NT
THE ECONOMICS
OF TUBERCULOSIS CONTROL
By Hays TH. WAALER fiom the Na:hmal Tuberculosis Register, Directorate of Health Services, Oslo
"Economics is not a popular subject among tuberculosis specialists or at tuberculosis conferences. But it is tile core of the problem of tuberculosis in Africa and the world.' This is a quotation from a leading article in the December issue of Tubercle last year. The unpopularity is probably caused by the apparent irrelevancy of the subject. It does not appeal to the chest physician. The economics of tuberculosis control is to him a distant problem to be dealt with by somebody else. I shall, tlowever, attempt to demonstrate that basic economic considerations ;ire continuously forced upon anybody who is in a position to ~ake any action at all. 1 shall in tile present paper concentrate on a few basic principles which are supposed to be paramount for understanding the cost-aspect pertaining to rational planning.of control programmes. It is important in this field, as in others, to have some kind of logical frame of reference for thinking and action. It is important to have a theoretical model which depicts the actual problem and interplay between action and result. The general situation is characterized as follows: (11 There exists a problem or an object which one would like to reduce or to achieve. (2) There is a budget or some resources for implementation. (3) It is realized that the reduction of the problem or the achievement of the object can be attained by alternative routes or by several combinations of various production factors. The actual programruing problem then consists of allocating the resources in such a way that one produc~s the largest problem-reduction for tie given budget. This is a general situation facing everyone of you at several stages and in several situations. The actual formal solution is one of mathematical programruing which can be dealt with by modern mathematical methods. The solution is in fact achieved when the marginal impact is tile same in all directions, because if this is not the case, it would pay to transfer some resources from one direction into another direction. Considering for a moment an example of a different nature, i.e. the problem of reaching the top of the mountain. One may define the event of having reached the top when, irrespective of which direction you proceed, you start to descend. This situation is analogous to the situation facing a government or parliament when they. through their tax-policy, decide upon alternative expenditures in the directio~ of collective expenditure and private expenditure of the national product. They are facing the same allocation problem when it comes to splitting the budget in the direction of health, education, communication, industry. defence etc., where spending resources in all directions is supposed to increase welfare, but where only one combination of these allocations is the one that will give maximum community welfare. And further down the ladder, the director of health services is facing an allocation problem between various diseases, how much to spend on tuberculosis, how much on disease A, how much on disease B, etc., trying to minimize morbidity and mortality in some way. The tuberculosis division of the directorate of health can spend resources and influence expenditures in various directions on casefinding, treatment, BCG-programmes, chemoprophylaxisem. The problem facing them is the same: allocation of resources to various production factors with a view to making the greatest impact on the problem. Finally, the clinician may be facing an analogous situation when allocating drugs to his patients. Now, if the general principle of solving such allocation problems were applied at the various
ECONOMICS
OF
TUBERCULOSIS
3
CONTROL
stages, simple considerations might give important and interesting conclusions for the actval programmer at the various levels. The total solution of these problems is complicated by, for instance, extensive interactions between the various factors and lack of information about the relationships, One does not know enough about the possible impact on various diseases, nor how to compare various outputs, nor is there enough detailed information about the actual long-term epidemiological impact of finding a case and of vaccinating a person etc.. But it is believed that realization of the problem and the general solution to it will help to achieve, if not an optimum allocation, a solution closer to the actual.optimum than one otherwise would have acilieved. Considering first the community problem of allocating resources in the direction of health, education, communication, industry etc. it is realized that there exists a very intimate interaction ~t
f ! i t
I
I
:i
I t
I
Il i (
t
i
,i +
i ?
1 l
_
!
;
f i
,
il
~szagr.
1
i
PlSEASE B
I
I ! i! i
, t9
ti
TIME FIG. 1
l'he 'problcm' of two diseases (A. and B,) and the 'problem-reduction' (shaded area) obtainable at the cost of D, Di.~a~c A is a larger problem than B; but the reduction o f the problem is greater with disease B.
between, for instance, J'ealth and industry through economic development. Interactions exist I~tween education and industry through the necessity of having trainedpeople for economic development, and between health and education, as, of course, is well known. The realization of these interactions is paramount tbr rational community planning. Consider the problem facing the director of health services and the fight between various groups in tile allocation of resources to various diseases. A rational procedure would allocate resources in the direction of disease B (Fig, I) instead of A irrespective of the fact that A represents a larger problem and irregpective of the already more advantageous trend for disease B. This view has considerable consequences for the present allocation of resources to tuberculosis, particularly so in i lie developed countriesLet us then consider the analogous problem in the field of tuberculosis. Now, the general principle of allocation will automatically tell us that a programme in the field of tuberculosis does not consist of this or that action, but should always be considered as a combination of various factors to be balanced in an optimum way according to the principles uthned above. This means, for instance, the very important point that whether one should ha% BCG,vaccination in a programme or not does not depend on the fraction of the tuberculosis problem that can be dealt with by this particular measure. The relevant thing is the marginal impact, or rather the marginal epidemiological impact that one can obtain for a given amount of mo~tey, It is not a question of.whether BCG can produce 10~oor 90~o of the problem reduction, but how mucl~ problem reduction one can obtain with $I in the direction of BCG as compared with another direction. Considerable knowledge about this is, O
w
.
4
TUBER(:LE SU P PLI-~M t-NT
in fact, available. To return to the problem about allocation between the various diseases, the allocation should n o t depend upon the size of the problem posed by the disease. It should n o t depend upon the trend of the disease, but on/), on the potential impact on the problem that can be olbtained, which should be clear from the figure presented. Most important in this context is the interaction between tuberculosis and other ,sections in the community. The allocation of community resources in many developing countries to fertilizer factories will have an impact on the tuberculosis problem in an indirect way and might conceivably be more effective.than any specitic actions against this disease. The fact that this relationship is difficult to estimate.does not make it less important to bear in mind. Finally let us consider the problem for a clinician under restricted drug budget conditions. What lie tries to achieve with his budget is either tO minimize the suffering for the known paticnt~ or to minimize the epidemioloaical_ harm produczd now and in the future. In any ca, c"she is facing an allocation problem. He can for a given budget construct almost an intinitc number of drug regimens by varying the combinations of drugs used, the doses, the frequency of giving the drugs, the duration of treatment etc. And in principle there exists only one combination of these factors for a given budget that will produce minimum .,,t~tl'ering or n~inimunl cpidemiological harm. Fortunately for the clinicians, at this levcl a considerable amount of information is available which should make it possible to achieve the optimuna allocation. The allocation problem is a b-~sic economic problem. The achievement of an optimum allocation is not easy. Even when the solution is known theorclically, prestige and vested interests may prevent an optimum solution. However. the realization of the problem and at least in principle of the solution, might give considerable improvements in the planning process and in the actions taken.
SOME
E C O N O N I l C A S P E C T S O F T U B E R C U I . O S I S C O N T R O l , IN AI, GERIA By L. MO~CHTARI(with A. BENGHI:ZAI., P. CitAULET and D. LARI3AOUI) from the Bureau de la Lutte C'ontre la Ttaberculose, Algiers
Algeria has a population ol'about 12 million inhabitants i~ an area of 2,372,940 square kilometres. Tile average population density is therefore 5.1 inhabitants per" square kiiometre. There is however a great difference between the density in the north, which is fairly thickly populated with from 20 to 485 inhabitants per sq. kin.. and the south, which is desert and has only 0-3 to 0.4 inhabitznts per sq. km. Thus the public health problems are quite different'in dae north and in the south.
Public Itealth in/~lgeria Algeria is i'n a rather more fortunate position than marly African countries in terms of medical personnel, hospitals and clinics. With 1,390 doctors, 45,000 hospital beds, and 643 general clinics, Algeria has roughly I doctor per 8,600 inhabitants, 1 general clinic per 18,000 inhabitants, and 1 hospital bed per 270 inhabitants. These national averages do not give a true picture of the real situation, because there are far more doctors and hospitals in the towns than in the country areas or in the south'. The importance attatzhed to public health services in Algeria is reflected in the national budget. Since independence in 1962, the health budget has been, on average, about 300,000,000 DA p.a. This represents about 10~,,/, of governmental expenditure, and means that the State is spending, on public health services, about 25 DA per person p.a., or about $5 per person p.a.