Finding novel, sustainable ways to finance NCDs

Where can the global health community find funding for noncommunicable diseases given the wide array of pressing health issues that need to be addressed and financed?

This is the unenviable task given to a group of technical experts, who, for the first time, are meeting Feb. 23-24 in Geneva to discuss which of the different financing models that currently exist could fund the prevention, control and treatment of NCDs — or if a new one is needed.

These experts form part of a new working group that was set up to accelerate progress on finding sustainable financing for NCDs. The group was established following a request from the World Health Organization’s member states. According to WHO communications officer Paul Garwood, the working group will be seeking input from state and nonstate actors in its quest to find sustainable financing models for NCDs.

Although funding for NCDs has been increasing, it continues to account for a small share of total development assistance for health. The U.N. health agency estimates about $11.4 billion is needed annually to control NCDs in low- and middle-income countries. But in 2011, donors disbursed only $377 million for NCDs.

While advocates aren’t expecting donors to shoulder all of NCDs’ financing needs — a majority of the funding is still expected to come from national budgets — they did hope funding would increase at a slightly faster pace. A commonly held notion behind the small donor disbursements for NCDs is that development assistance for health has generally been earmarked to meet health-related targets of the Millennium Development Goals. But there are other reasons.

In a briefing paper the Secretariat of the WHO Global Coordination Mechanism on the Prevention and Control of NCDs shared with Devex, it was noted that donors do not see NCDs as something that would pose immediate risk to others. They also do not see enough cost-effective interventions to prevent and control unhealthy factors such as obesity, which often leads to NCDs like high blood pressure and diabetes.

“Even if there’s been huge interest in NCDs … I think they are still hidden, misunderstood and underreported,” Bente Mikkelsen, head of the coordinating body’s secretariat, explained to Devex. “I think the political commitment is definitely there, but it’s the move from commitment to action that is the real difficulty, and where developing countries are struggling the most.”

Focus on 3 innovative financing approaches

With very low donor funding and difficulties in mobilizing domestic financing, the working group is expected to explore innovative means of financing NCDs.

Some countries like the Philippines have already implemented such novel ways to fund NCDs. In 2012, the predominantly Catholic nation imposed high levies on alcohol and tobacco products to discourage the consumption of so-called sin products, and create additional revenue for the country’s health programs. In 2014, the country’s Department of Health claimed its budget increased 57.9 percent to 83.7 billion Philippine pesos ($1.89 billion) because of revenues from “sin taxes.”

Critics however claim it’s unclear whether revenues from sin taxes are being used for their intended purposes, which are to help provide alternative livelihoods for tobacco farmers and workers, and boost the government’s medical assistance and national health insurance program.

This challenge of effective tax distribution will be among the issues the working group will discuss at the two-day meeting, which is also expected to renew discussions on setting up a Solidarity Tobacco Contribution. A concept WHO developed in 2011, STC will enable small levies to be imposed on cigarettes, alcohol and unhealthy food, whose proceeds will be then be earmarked for international efforts to prevent, control and treat NCDs.

But STC was proposed to solicit voluntary contributions from WHO member states. If such an approach is pursued, the challenge would be to identify ways to encourage member states to fund it on a regular — and predictable — basis. This of course is no easy task. The U.N. health agency has struggled with unpredictable funding for its programs for years, largely because the bulk of its programming budget continues to depend on voluntary contributions.

The working group will be discussing whether public-private partnership models like the Gavi, the Vaccine Alliance and the Global Fund to Fight AIDS, Tuberculosis and Malaria would be a good way to raise some funding for NCDs. In addition, they will see whether implementing awareness-raising campaigns, such as using pink ribbons to spread breast cancer awareness, could help the NCDs cause.

But new approaches also up for discussion are STC and two other financing models: an NCD financing trust fund and an NCD-specific government bond.

An NCD financing trust fund would be similar to the many trust funds supported by a number of donor countries and administered by a multilateral agency like the World Bank. Money will be provided through low-interest loans and grants or be used to engage the private sector in addressing the problem of NCDs in select countries.

As regards the bond, the use of this model needs to be examined more carefully to find out all possible consequences of higher government borrowing, which may come as a result of issuing the bond, according to the policy brief.

A report of the meeting will be publicly available in March. Any potential recommendations that may be submitted to WHO Director-General Margaret Chan won’t be available until later in the year.

“We have discussed NCD for years; we have to now go from planning to implementation,” Mikkelsen said, adding that NCDs have “very few [financing] models in action at the moment.”

The group also underscored the importance of finding ways to fund NCDs, particularly as the international development community gears up to discuss how to finance the next set of development goals in July.

“Addressing NCDs needs to be seen as part of the solution to development challenges and eliminating poverty,” Mikkelsen concluded.

Know of a financing model that could fund NCD control, prevention and treatment in a sustainable and predictable way? Let us know by leaving a comment below.

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