Advancing Sexual and Reproductive Health and Rights
Perspectives on Sexual and Reproductive Health
Volume 38, Number 2, June 2006

Bulk of Health Care Costs for People with HIV Are for Drugs, Hospitalization

Annual expenditures on primary health care for individuals attending an outpatient HIV clinic in Alabama amount to nearly $20,000 per patient; the drugs used for highly active antiretroviral treatment (HAART) account for more than half of the total. Costs among the sickest patients (those with the lowest CD4 cell counts) come to nearly triple those among individuals whose disease is least advanced. However, the cost of HAART is fairly consistent regardless of stage of the disease; therefore, the sicker the individual, the smaller the share of expenditures attributable to these medications. Increased expenditures for individuals with the lowest CD4 cell counts reflect mainly their need for other types of medication and for hospitalization. Provider costs represent a negligible proportion of medical care costs for HIV patients, irrespective of CD4 cell count.1

Using a database containing information on all patients receiving primary care at a university HIV clinic in the 12 months beginning March 2000, analysts examined five components of care: hospitalization (including inpatient medications, examinations and procedures), antiretroviral medications, other drugs, physician and clinic fees (for inpatient and outpatient care), and outpatient services performed at a site other than the clinic (such as home health care and laboratory studies). They determined cost data from Medicare reimbursement rates and average wholesale prices of medications.

The analyses included 635 patients who had a baseline CD4 cell count on March 1, 2000, and at least one clinic visit or hospitalization later in the study period; half were followed up for at least seven months. The majority of the cohort were male (77%) and white (59%); the average age was 35 years. Fifty-four percent of individuals in the cohort had private health insurance, 31% were covered by a public program and 15% lacked any health care coverage. Eight in 10 patients were receiving HAART at baseline, and data on their viral load indicate that they were generally responding well to the treatment. The analysts categorized patients by four strata of CD4 cell counts at baseline; 10% of the cohort were in the lowest stratum, and 52% were in the highest.

Overall, annual expenditures averaged $18,640 per patient. Of this total, 56% was attributable to antiretroviral medications, 23% to other drugs, 13% to hospital costs, 6% to outpatient services not provided at the clinic and 2% to physician or clinic costs. Expenditures totaled $13,885 for individuals at the earliest stage of disease but rose steadily across declining strata of CD4 cell counts, reaching $36,532 for those with the most advanced disease. Most of the disparity was accounted for by differences in costs of drugs other than antiretroviral medications ($1,885 for individuals with the least advanced disease, compared with $14,882 for the sickest patients) and of hospitalization ($1,408 vs. $8,353). By contrast, the cost of HAART was not directly related to stage of the disease and fluctuated only between about $9,407 and $11,935 per year; consequently, HAART represented 68% of costs for individuals with the highest CD4 cell counts, but only 30% for those with the lowest counts. Outpatient services not delivered at the clinic accounted for 5–7% of expenditures, depending on the stage of a patient's disease; physician and clinic costs, for 1–2%.

For patients who were initially in the next-to-lowest stratum of CD4 cell counts, a decline in CD4 cell count within six months after baseline was associated with a statistically significant increase in health care expenditures; the increased expenditures were accounted for mainly by medications other than antiretroviral drugs and hospitalizations. No similar relationship was observed for the sickest patients or for those whose disease was less advanced.

The analysts comment that primary health care expenditures on individuals with HIV infection "are, paradoxically, both decreased by and driven by the use of antiretroviral medications." However, the "most striking finding," in their view, was the low level of expenditures attributable to physician and clinic services. The 2% average expenditure for this component of care amounts to about $360 per patient per year, a fraction of the $1,500–2,000 that it costs to provide physician and clinic services.2 According to the analysts, this "meager" level of reimbursement is "inadequate to cover the cost of care provision at most HIV clinics in the United States, the majority of which are subsidized by federal and state dollars."—D. Hollander


1. Chen RY et al., Distribution of health care expenditures for HIV-infected patients, Clinical Infectious Diseases, 2006, 42(2):1003–1010.

2. Infectious Diseases Society of America, Study shows AIDS drugs cost-effective, care underfunded, news release, Alexandria, VA, Feb. 27, 2006.