Does integration of HIV and SRH services achieve economies of scale and scope in practice? A cost function analysis of the Integra Initiative

OBJECTIVE: Policy-makers have long argued about the potential efficiency gains and cost savings from integrating HIV and sexual reproductive health (SRH) services, particularly in resource-constrained settings with generalised HIV epidemics. However, until now, little empirical evidence exists on whether the hypothesised efficiency gains associated with such integration can be achieved in practice. METHODS: We estimated a quadratic cost function using data obtained from 40 health facilities, over a 2-year-period, in Kenya and Swaziland. The quadratic specification enables us to determine the existence of economies of scale and scope. FINDINGS: The empirical results reveal that at the current output levels, only HIV counselling and testing services are characterised by service-specific economies of scale. However, no overall economies of scale exist as all outputs are increased. The results also indicate cost complementarities between cervical cancer screening and HIV care; post-natal care and HIV care and family planning and sexually transmitted infection treatment combinations only. CONCLUSIONS: The results from this analysis reveal that contrary to expectation, efficiency gains from the integration of HIV and SRH services, if any, are likely to be modest. Efficiency gains are likely to be most achievable in settings that are currently delivering HIV and SRH services at a low scale with high levels of fixed costs. The presence of cost complementarities for only three service combinations implies that careful consideration of setting-specific clinical practices and the extent to which they can be combined should be made when deciding which services to integrate. TRIAL REGISTRATION NUMBER: NCT01694862.