A Study On The Funding, Allocation And Utilization Of HIV/AIDS Resources In China

BACKGROUNDThe epidemic of HIV/AIDS has been a great public health crisis, and it has become one of the make-or-break forces of this century, as measured by its actual impact and potential threat to the survival and wellbeing of people worldwide. The global impact of AIDS has already been so devastating that the United Nations' Human Development Report 2005 concluded that "the HIV/AIDS pandemic has inflicted the single greatest reversal in human development. Compared to the amount of fund needed for HIV/AIDS prevention and treatment, inadequate funding is a global problem. According to UNAIDS estimates, the current global fund for AIDS prevention and control of international cooperation is about 10 billion US dollars every year while the actual requirements will be up to 20-23 billion dollars a year.The epidemic and experiences of the world has shown that the prevention and control of HIV/AIDS is an urgent, complex and long-term and arduous task. The Chinese Government attaches great importance to HIV/AIDS prevention and control, and the amount of funds invested in HIV/AIDS control has been growing rapidly in the past decade. On Jan 29, The State Council promulgated the " Regulations on AIDS Prevention and Treatment", which clear the AIDS funding mechanisms that Local governments at the county level or above are responsible for providing the necessary financial expenditure of AIDS prevention, control, and supervision-monitoring in accordance with their respective functions, the central financial department of the national government provides subsidies to the AIDS high epidemic area and the important projects implemented in the economically under-developed area, and national government encourages and supports the development of international co-operations and communications in AIDS prevention and treatment. The regulations clear the HIV/AIDS financing mechanisms of "government investment as the mainstay, grading commitment and multi-channel financing". The central government established a special funds for HIV/AIDS prevention and treatment, included in the annual central budget, mainly for the relevant central departments and subsidies for the areas with high disease burden and with financing difficulties.Currently, the major source of China's HIV/AIDS funding is government financial input, and it plays a leading role with characteristics of a large volume, stable and strong sustainability. The international cooperation funds plays an important complementary role, with a relatively large number of funds.In recent years, with the rapid growth of the resources for response to HIV/AIDS epidemic, the issue of HIV/AIDS financing has been gradually paid increasing academic attention. From the research results, the following conclusions can be made: 1) Local governments have not yet fully committed to funding duties; and 2) The distribution of the central financial grants in the provinces embodies the principle of "key support for AIDS-stricken areas", but did not reflect the principle of "key subsidies for poverty-stricken areas". Due to the availability of data, researches on HIV/AIDS funding are still limited, with conclusions drawn at the national or provincial level. However, the work of HIV/AIDS prevention and control is mainly implemented at the county level. At present there is not enough studies on the issue of HIV/AIDS funding at the province, especially at the county level, and such studies has significance for the decision making and evaluation of HIV/AIDS funding. In addition, the issue of the input/output, the actual utilization and efficiency of HIV/AIDS funds is a major concern of decision-makers, but it is still blank in literatures。The main aim of this study is to reveal the fulfillment of the duties of the county-level governments in HIV/AIDS funding, and the reasonableness of the allocation of central financial resources among the counties, and the factors impacting the efficiency of fund utilization, through the analysis of financing, distribution and utilization of HIV/AIDS funds.METHODSQuantitative analysis along with case analysis is used in this study. According to the objectives, HIV/AIDS epidemic and funding data from 2004 to 2006 of 181 counties in Sichuan Province were collected, and epidemic and input/output data from 2005 to 2007 of 72 project counties in seven provinces (Anhui, Hebei, Henan, Hubei, Shandong, Shanxi and Shannxi Province) in middle China were collected for analysis.Statistical analysis methods used include descriptive analysis, ANOVA, Probit model and linier regression。The data structure collected for this study are all panel data (cross-sectional time series data). The statistical analysis of panel data needs special handling, which includes adjustment of degree of freedom for repeated measure in ANOVA, dividing the regression model into between and within model, which is further divided into fixed effect model and random effect model.The software of MS Excel is used for descriptive analysis, and StatalOis used for statistical model analysis.RESULTSThe percentage of counties which established special funds for HIV/AIDS prevention and control is very low. In 2004, only 16 counties (8.84%) among 181 counties setup a special HIV/AIDS fund, with otal amount of 0.48 million yuan,the maximum amount of 100 thousand yuan and minimum amount of 2 thousand yuan; and in 2005, only 28 counties (15.47%) among 181 counties setup a special HIV/AIDS fund, with total amount of 1.57 million yuan, the maximum amount of 200 thousand yuan and minimum amount of 3 thousand yuan。The number of HIV/AIDS cases reported and GDP per capita have no statistical significant impacts on the amount of HIV/AIDS funds at county level。Although the number of population has significant impact on the amount of HIV/AIDS funds, its actual effect is relatively small, with R square only 0.045 in the regression model.The number of HIV/AIDS cases reported, number of population and GDP per capita all have statistical impacts on the amount of HIV/AIDS funds, but the main effects come from the variable "the number of HIV/AIDS cases reported", and the effects of the other two variables are relatively small。The distribution of the central financial grants at the county level embodies the principle of "key support for AIDS-stricken areas", but did not reflect the principle of "key subsidies for poverty-stricken areas".From 2005 to 2007, the fulfillment rate of HIV/AIDS fund was gradually increasing. In 2007, the average rate was up to 98.36%. The proportion of funds for multi-sectional cooperation in HIV/AIDS control was increasing, and it was about half of the total activity fund. The organizations involved in the cooperation included trade unions, the Communist Youth League, women's federations, the Red Cross, Family Planning Commission, the relevant institutes and associations, academic institutions and Grass-roots organizations. The average amount of fund for each multi-sectional activity was 15 thousand yuan, ranging from one thousand to hundreds of thousands of yuan.The unit cost of VCT varied between provinces and periods, ranging from 30.25 yuanto 356.65 yuan. The unit cost of VCT was decreasing, from 100.24 yuna in the beginning period to 61.63 yuan in the latest period, down 38.52%. The regression model suggests that the unit cost of VCT will decrease 30% if the total fund invested in VCT increased by 100 thousand yuan.The unit cost of ART varied greatly provinces and periods, ranging from 51.84 yuanto 8601.06 yuan. Contrary to the trend of unit cost of VCT, the unit cost of ART was increasing, from 193.55 yuna in the beginning period to 450.92 yuan in the latest period, up 3.82 times. The regression model suggests that the unit cost of ART will increase 81% if the total fund invested in ART increased by 100 thousand yuan.The AIDS program in 72 counties in middle China has achieved remarkable results. Compared with 2005,the percentage of general population who both correctly identify ways of preventing the sexual tranmission of HIV and reject major misconceptions about HIV increased 32 percentage points in 2007, and this percentage of FSW increased 32 percentage point. The percentage of sex workers who report using a condom with their most recent client increased 13 percentage point in the same period. CONCLUSIONS AND RECOMMENDATIONSLocal governments did not perform their duties of financing for HIV/AIDS. In general, county level governments has a serious shortage of financial input in HIV/AIDS. It is recommended that the central government should adopt effective measures to enable local governments to assume the due responsibilities of financing HIV/AIDS. The financial inputs in HIV/AIDS of local governments especially county governments should be specifically identified and quantified. Local financial input should accord with their financial capacity. Economically developed counties should invest more funding, while economically underdeveloped areas can input less funding. The funding gap of underdeveloped areas can be complemented by the financial transfer payment of central and provincial governments.The allocation of the central financial grants at the county level embodies the principle of "key support for AIDS-stricken areas", but did not reflect the principle of "key subsidies for poverty-stricken areas". It is recommended that the allocation schemes of central and provincial HIV/AIDS funding should be opened and clearly justified. The function of transfer payment of central financial funding should be embodied in the allocation schemes. The central and provincial government should strengthen subsidies to the economically under-developed areas.In the process of HIV/AIDS project implementation, researches should be made on efficiency and factors impacting efficiency, and according to the results of the researches, allocation of fund should be adjusted so as to enhance the efficiency of the fund utilization. Take VCT and ART as an example, the results of this study show that efficiency of VCT improves with the increase of input in VCT, so from the aspect of efficiency, the sustainability of funding for VCT should be guaranteed after the close of AIDS project. On the contrary, the efficiency of ART decreases with the increase of input in ART. The decision-makers could set a efficiency threshold according to the results of measurement, and the funds deficiently used below the threshold may be transferred to other work fields or other areas, so that to improve the efficiency. However, under normal circumstances, the procedures for such fund transfers are complex and difficult。This problem should be first resolved.