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More Efficient Family Planning Through Innovative Finance

Written by Kathy Calvin - CEO of UN Foundation.

kathyCalvinGlobally, more than 215 Million women lack access to modern forms of reproductive health commodities. Now with less than 4 years remaining until the target for meeting the Millennium Development Goals (MDGs), funding for international family planning has taken a serious hit due to a reduction in global giving. Even with the understanding that modern forms of contraceptives have helped a number of countries empower women to plan the timing and size of their families to reduce the number of unwanted pregnancies, maternal and infant deaths, funding cuts are posing a great challenge to achieving MDG 5 goals.

When Donors, Ministers of Finance and Ministers of Health face constraints, they are often forced to make short-term decisions that are based on per-unit price rather than long-term value. For example to ensure the greatest number of women have access given a certain funding envelope, when faced the question of whether to fund a 3 cents a day condom or a $20 implant, they often choose the former. At first glance it seems practical to not spend $20 on one woman but rather provide condoms for nearly 700 women. However, because implants cover a woman for 3-5 years, if you compare its daily cost of less than 2 cents to a 3-cent condom, the price of an implant on a per use basis is actually cheaper. Furthermore, when you consider the possibility of a woman forgetting to take her pill, or the program costs of constant distribution, the relative value of long-acting reversible methods of contraceptives like implants becomes even clearer.

Through the leadership of the Reproductive Health Supplies Coalition, the Pledge Guarantee for Health (PGH) has designed an innovative financing mechanism enabling donors and recipient countries to access higher quality and more effective methods of contraceptives both faster and at no additional cost. This is possible through bridge financing; by leveraging both Letters of Credit and Supplier Credit thru bank guarantees (backed by the Bill and Melinda Gates Foundation) health supplies can be shipped ahead of time while the normal processes of transferring donor funding for a particular commodity is worked out. Essentially, without needing to increase funding for implants, this framework enables donors and recipient countries to amortize the payments over time while front loading the delivery of implants so women can benefit from more years of protection. The public health benefits are obvious in that countries will be able to avert more maternal and child deaths; and on the productivity front, economies will be able to maximize the potential demographic dividends.

Again, being only 4 years away from MDG deadlines, if we are to reach our goals of increased access to reproductive health now is the time to innovate, to use all the resources, ideas and partners at our disposable. We cannot allow austerity diminish our drive to solve problems of global poverty.

GHD Winter 2014 Digital Edition

GHD Contributors - Winter 2013

David B. Agus, MD, Shamsia Anwari, F.E. Baralle, MD, PhD, Dr. Seth Berkley, Vittorio Cammarota, The Honourable Gunilla Carlsson, Francis Collins, MD, PhD, Dr. Suraya Dalil, Ambassador Mark Dybul, Dr. Thomas Evans, The Right Honourable Stephen Harper, Karl Hofmann, His Excellency Jakaya Kikwete, Gregory T. Lucier, Partha P. Majumder, PhD, Dr. Carole Presern, Scott C, Ratzan MD,MPA, Dr. David Reddy, Janet Hatcher Roberts, Professor Jeffrey D. Sachs, Dr. Sima Samar, His Excellency Dr. Jorge Sampaio, Dr. Ataulhaq Sanaie, Dr. Khaled Seddiq, Dr. Richard Sezibera, Dr. Ahmed Shadoul, Jill Sheffield, Michel Sidibé, Prabhjot Singh, Her Excellency Ellen Johnson Sirleaf, Kari Stoever, H.E Jakaya Kikwete, Hervé Verhoosel, Princess Sarah Zeid