ART—hence the 75 percent suballocation for ARVs within the 55 percent allocation for treatment. According to some current estimates, however, ARVs now account for a relatively small and declining proportion of the total cost of ART (Martinson, 2006), while increases in the number of children being treated, as well as in the number of individuals on second-line medications, are likely to shift cost patterns once again.

The lack of an evidence base for the budget allocations and a rationale linking the allocations to performance targets and goals has adversely affected implementation in a number of ways described by the Country Teams and others. First, the budget allocations limit the Country Teams’ ability to harmonize PEPFAR’s activities with those of the partner government and other donors. Although OGAC requires each Country Team to meet the same allocations, national plans and epidemiologic data suggest that the relative allocations among categories would appropriately vary by country. For example, approximately 10 percent of all children under age 17 are estimated to be orphans in Nigeria, whereas the proportion in Botswana is 20 percent (USAID et al., 2004).

Second, PEPFAR’s categories of prevention, treatment, and care and the subcategories within them fragment the natural continuum of needs and services, often in ways that do not correspond to global standards, do not align with an individual focus country’s perspective, and do not permit optimal management of patients and their families. ART programs (categorized as treatment) and counseling and testing programs (categorized as care) need to be closely linked so that HIV-positive people can be quickly referred from counseling and testing sites for evaluation for treatment, and the partners and families of patients can receive counseling and testing promptly. Separate funding can serve to sever these linkages.

There has also been some misalignment of activities across the program categories of prevention, treatment, and care. The result has been a lack of emphasis on some crucial activities. For example, voluntary counseling and testing is included in the care category (mainly for HIV case finding) rather than under prevention, although it has long been considered an important element of prevention approaches. Consequently, there has been insufficient emphasis on quality counseling and testing as a prevention tool. Likewise, treatment is narrowly defined as ART, but a comprehensive basic treatment package includes elements categorized as both prevention (for example, services addressing sexually transmitted infections) and care (for example, treatment of opportunistic infections and pain management) (OGAC, 2004). Care, which is the fundamental organizing principle for the full spectrum of HIV/AIDS interventions and typically includes both preventive care and ART, is instead a catch-all for what does not fit easily within the prevention and treatment categories and budget allocations. To achieve longer-term targets and the ultimate goals of the Leadership Act—

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