Using iSIKHNAS for Budget Advocacy

1. Using iSIKHNAS for Budget Advocacy 3.2 Estimating costs of disease

2. Objective for this session • At the end of this session you should be able to: • Estimate the overall losses (economic impact) due to disease in a population • Undertake a simple sensitivity analysis

3. Estimating the cost of disease • Identify the affected production system or systems and obtain production and economic information for these systems • Calculate the “unit cost” of disease for each affected production system. This is the loss incurred for each affected animal or farm • Estimate the number of affected farms (or animals) in each production system within the area of interest. • Calculate the total annual cost based on the production systems and estimated number of farms or animals affected in each area of interest

4. Step 1: Identify affected production system • Identify the affected production systems and obtain production and economic information for these systems • For example, chickens (layer, broiler, native), cattle breeding, sheep/goats, pigs • Obtain data on average levels of production and costs, such as: • Production system details, farm sizes, normal mortality rates, reproduction rates, etc. • Animal population data including age groupings etc. • Average type and volume of products produced per cycle or year • Average prices received for products • Average prices for major costs for the production system

5. Step 2:How many are affected? • Estimate the number of affected farms (or animals) in each production system within the area of interest • This depends on: • The estimate number of animals or farms in the area of interest and • The estimated proportion of animals or farms affected (prevalence of disease)

6. Step 3:Calculate unit cost of disease • Calculate the cost of disease for each affected farm or animal • This includes costs due to direct and indirect effects of disease: • Mortality estimates – how many or what proportion of animals die from a disease? • Morbidity estimates and the effects on production or price • Disease frequency or prevalence of a disease within an area of interest • The time period required for a farm to return to the level of production prior to the disease (foregone income) • Other possible indirect effects of disease

7. Step 4:Calculate the total annual loss • Calculate the total annual cost based on the production systems and estimated number of farms or animals affected in each area of interest • Total cost = number of affected farms (animals) X unit cost per affected farm (or animal)

8. Example • Work through abortion example on screen: • Open 3.2 Cost of disease examples-2.xlsx, worksheet Abortions (cattle) • Discuss what each cell means and participants to provide appropriate values for orange highlighted cells • Discuss the final result – what does it mean?

9. Discussion and questions • Is this a problem that is worth trying to do something about? • What could you do to try and improve? • What would happen if different values are used? • Try some different values

11. Sensitivity analysis • A sensitivity analysis is used to test the importance of assumptions used in the analysis. • shows how big an effect any errors in assumed values will have on the answer you get • Process: • Identify the assumed values for which you need to do the analysis (this should include ALL values that you are uncertain about) • For each of these in turn enter an extreme minimum value (while all of the other inputs remain the same) and note the result. • Repeat this process for an extreme maximum value. • Repeat for all of the other important variables identified.

12. Exercise • Bovine abortions: • See Cost of disease examples-2.xlsx, worksheet Sensitivity analysis for details • Individually or in small groups • Table & graph show results for varying: • abortion percentage • expected mortality in calves • estimated sale price • rearing costs • One participant to show results and discuss findings

13. Discussion • What does the analysis tell you? • Open example answer sheet (Sensitivity analysis example) if necessary

14. Key issues • estimated abortion rate and the expected sale price for the calf: • make a big difference to result • important to have reliable estimates • mortality between birth and sale and rearing costs: • small effects • less important to have accurate data

15. Final discussion • Any final questions or comments?

16. Session summary • To estimate losses due to disease: • Obtain information about the affected production system • Calculate the unit loss from disease for each affected farm or animal • Estimate the number of affected farms (or animals) • Calculate the total annual loss • Undertake a sensitivity analysis • Try high and low values for uncertain inputs to see what effect the change has • If results change a lot when the input value changes that input has a big influence and is important to have reliable estimates

17. Additional exercise or homework • Only if there is time or if participants wish to do some homework • Singly or in small groups • Work through example: • Helminthiasis: in Cost of disease examples-2.xlsx, worksheet Helminthiasis (cattle) • Enter values that you think are appropriate for your area

18. Discussion • General discussion of result: • What was the cost of helminthiasis? • Who is this affecting? • Is it worth spending money to reduce this cost? • What would you recommend to reduce the cost of helminthiasis?