Financial Sustainability of Immunization Programs
Even though research has demonstrated that vaccination against childhood diseases is one of the most cost-effective health interventions, governments in many developing countries are considering how to meet the financing requirements of immunization programs, particularly as new vaccines are introduced and programs are scaled up. GAVI is working with countries to prepare for the transition from grant funding and to secure the overall financial sustainability of national programs. Approximately 55 countries have prepared national financial sustainability plans for immunization. These plans help countries evaluate the current and future costs and financing of national immunization programs and identify strategies to address future funding gaps (GAVI 2004; http://www.who.int/immunization_financing/en).
According to a recent analysis of financial sustainability plans, specific costs for immunization programs represent an average of 2 percent of total health spending and 6 percent of government health spending and are equivalent to less than 0.2 percent of gross domestic product on average. However, this profile changes after new and more expensive vaccines are introduced. In some countries, program-specific costs for immunization can reach as high as 20 percent of government health spending with introduction of combination vaccines (Lydon 2004). This share is related to the current unit price of the vaccine, which is expected to decline.
Governments and their development partners are challenged to find ways to finance and sustain immunization programs. In countries that are implementing reforms to achieve greater transparency and fiscal discipline through sectorwide approaches and medium-term expenditure frameworks, the additional financing requirements are compounded by the need to operate within a fixed budget for the health sector, so that increased funding needs for one program may necessitate budget cuts for others. This example illustrates the potential tradeoffs that exist at the country level, which create both opportunities for more open policy dialogue in relation to priority setting for the use of scarce public funds and risks that the cost of new vaccines may not be readily integrated into national plans and budgets. Because of the financial implications of reaching higher coverage levels and simultaneously introducing new vaccines, policy makers will not only have to weigh the cost-worthiness of alternative investments but also have to understand their long-term budgetary implications.
