July 10, 2015 Kim Krisberg 0Comment

Thanks to the Affordable Care Act, American women are saving hundreds of dollars on birth control, according to the first study to document the impact of health reform on prescription contraception spending.

To conduct the study, which was published this month in Health Affairs, researchers analyzed claims data from a large national insurer between January 2008 and June 2013, eventually examining data linked to more than 790,800 women. They found that the average out-of-pocket expense decreased for nearly all prescription contraceptive methods on the market. In particular, the average out-of-pocket savings per patient was an annual savings of $255 for the oral contraceptive pill and $248 for an intrauterine device (more commonly known as an IUD, a long-acting, reversible contraceptive that is inserted into a woman’s uterus). The average out-of-pocket costs for both the pill and IUDs dropped by 20 percentage points after the ACA kicked in. With implementation of the ACA, prescription contraceptives are among an array of preventive services that private insurers must now cover without cost sharing. (However, the contraceptive requirement does not apply to certain grandfathered plans and employers who are exempted for religious reasons.)

So, why is this so important? Well, in addition to widening access to a critical component of women’s health care and giving women control over their reproductive lives, the study’s authors — Nora Becker and Daniel Polsky — noted that contraception access has far-reaching social and economic benefits as well. They write:

Contraceptive use also has important effects on families and the economy. Studies of the effects of legalization of the contraceptive pill in the 1960s and 1970s found that increased access to contraception was associated with lower rates of subsequent entry into poverty, higher rates of labor-force participation and entry into professional school, and higher wages for women. These economic gains also affect subsequent generations: The children of women with increased access to contraception have higher rates of college completion and higher incomes, compared to children whose mothers did not have access to family planning.

The Health Affairs study found that between June 2012 and June 2013, average out-of-pocket costs from the pill dropped from $33.58 to $19.84, while costs for an IUD insertion fell from $293.28 to $145.24. In addition to those two forms of contraception, researchers also found significant reductions in out-of-pocket spending for emergency contraception, diaphragms, contraceptive implants and contraceptive injections.

The authors write: “Median spending for almost all contraceptive methods fell to zero within 10 months of implementation (of the ACA), and mean spending dropped by large percentages (38-93 percent, depending on the (contraceptive) method).” However, the study found that mean (or average) out-of-pocket spending on contraceptives remained above zero for two main reasons: not all contraceptive brands are required to be covered at no cost to beneficiaries and grandfathered insurance plans aren’t subject to the no-cost-sharing rule. (To clarify the last two sentences: “Median” refers to the mid-point separating the higher and lower halves of the data sample; while “mean” represents the average amount women are paying.)

The researchers noted that before the Affordable Care Act, a significant amount of out-of-pocket health care spending among women who use prescriptive birth control went toward contraception. In fact, the researchers estimated that based on the more than 6 million U.S. women using the pill, the Affordable Care Act requirements are leading to $1.4 billion per year in out-of-pocket savings.

“It’s possible that by decreasing out-of-pocket expenses, more women will use contraception, or switch to a longer-term method, but additional research is needed to determine both the socioeconomic and health effects for women,” study co-author Polsky, executive director of the Leonard Davis Institute of Health Economics, said in a news release. “In the long term, if we do in fact see an increase in the use of contraceptives, that could potentially lead to a lower overall fertility rate, and potentially increased economic opportunities for women and their families.”

In related and unfortunate news, some members of Congress are proposing a complete elimination of funding for the Title X program, a proven and effective initiative that funds a network of clinics in providing millions of low-income women with contraception and family planning services, cancer screenings, disease testing and reproductive health services. The Pump Handle’s Liz Borkowski wrote about the proposed budget cut earlier this month and why it makes no sense for women’s health or health care spending. And read this piece from the Guttmacher Institute on why Title X remains vital to millions of American women, even with the ACA insurance expansion.

To request a full copy of the Health Affairs study, click here.

Kim Krisberg is a freelance public health writer living in Austin, Texas, and has been writing about public health for more than a decade.

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