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White House Covering contraception is cost neutral since it saves money The Birth Control Controversy and Using Todays Costs for Tomorrows Savings
"Cost neutral and saves money?"
"What the hell does that mean?" asks the Disease Management Care Blog.
How can a White House Fact Sheet simultaneously assert that an insurance mandate simultaneously costs nothing and also reduces health care costs? Is this cognitive dissonance? Clever obfuscation? Insurance amateurism?
The physician DMCB fully understands the importance of contraception in womens health.
The logical DMCB knows someone has to eventually pay for birth control pills and doesnt understand the material difference between a mandate for buying contraceptive coverage versus buying mandated insurer coverage of contraceptives.
The accommodating DMCB wonders if religious leaders could compromise by agreeing to cover birth control pills with a "100% co-pay."
But the blogging DMCB couldnt resist looking at the of real world difficulty of reconciling todays insurer hard costs and tomorrows savings. Over the years, it has learned its never that easy.
Read on and see why that rule holds here.
So, just what is the evidence on birth control pills (BCPs)?
While BCPs $15 to $50 a month retail cost contrasts with the average $13,000 to $17,000 total charge for childbirth, its not that simple. Add up the additional cost of thousands of BCP prescriptions, their associated provider visits plus unnecessary testing, a 15% failure rate and a low but appreciable rate of side effects, its very possible that the aggregate costs of BCPs could exceed any savings from a fewer number of unwanted pregnancies.
The WH Fact Sheet addresses this by saying that prior studies show.....
"...there was no increase in premiums when contraception was added to the Federal Employees Health Benefit System and required of non-religious employers in Hawaii. One study found that covering contraception saved employees $97 per year, per employee."
As far as "Hawaii" goes, the DMCB discovered that White House is quoting "empirical evidence" from a 2001 study from the states Insurance Commissioner. It describes the experience of four commercial health plans (anonymously named A, B, C and D) that went through a state-imposed contraceptive mandate. "A" already covered it, "B" saw a 14 cents per member cost of "contraceptive services and supplies" and "no material changes in eligible charges for maternity related services," "C" had a $1.50 increase in "contraceptive costs" and an approximate $7 decrease in maternity costs per 1000 members (which the Commissioner summarizes as of "little effect"), and "D" which had an 11.5% increase in pregnant members as the contraceptive mandate was implemented.
And where does the Fact Sheets "$97" savings figure come from? The DMCB suspects the number comes from Table 4 of a 2000 CDC and Washington Business Group on Health Report here which quotes scenario economic modeling of $562 vs. $659 per employee per year with and without a contraceptive benefit, respectively.
While it was thinking about the topic of economic modeling, the DMCB found this interesting 1996 study of the cost-effectiveness of family planning services for the British National Health Service. Based on a cost of £39 and "0.82" avoided pregnancies per year, the authors estimate that the NHS saved £754 "per avoided pregnancy." The DMCB suspects the White House would probably per to not quote this one.
The DMCBs conclusion: there is no real world evidence that oral contraceptives save any money by reducing claims expense. Any evidence that there are savings are based on methodologically suspect economic modeling and actuarial studies. While the good news is that BCPs probably wont increase insurance costs, the bad news is that it does little to tame health care inflation. Thats probably why this small recent survey of U.S. health insurers indicates that they dont believe it will save money either.
Two other DMCB points:
Given the experience in Europe, even if the mandate for contraceptive coverage wins this round, it will remain vulnerable to political and economic meddling... probably forever. Womens health deserves better.
BCPs are easy to prescribe. Given the likelihood of not enough PCPs to meet demand,it can be argued a physician office visit is unnecessary - which would further lower costs. It has also been argued that BCPs should be made available without a prescription, which begs the question of why this should be an "insurance benefit" in the first place.
Image from Wikipedia
White House Covering contraception is cost neutral since it saves money The Birth Control Controversy and Using Todays Costs for Tomorrows Savings
Saturday, May 3, 2014
"Cost neutral and saves money?" "What the hell does that mean?" asks the Disease Management Care Blog.
How can a White House Fact Sheet simultaneously assert that an insurance mandate simultaneously costs nothing and also reduces health care costs? Is this cognitive dissonance? Clever obfuscation? Insurance amateurism?
The physician DMCB fully understands the importance of contraception in womens health.
The logical DMCB knows someone has to eventually pay for birth control pills and doesnt understand the material difference between a mandate for buying contraceptive coverage versus buying mandated insurer coverage of contraceptives.
The accommodating DMCB wonders if religious leaders could compromise by agreeing to cover birth control pills with a "100% co-pay."
But the blogging DMCB couldnt resist looking at the of real world difficulty of reconciling todays insurer hard costs and tomorrows savings. Over the years, it has learned its never that easy.
Read on and see why that rule holds here.
So, just what is the evidence on birth control pills (BCPs)?
While BCPs $15 to $50 a month retail cost contrasts with the average $13,000 to $17,000 total charge for childbirth, its not that simple. Add up the additional cost of thousands of BCP prescriptions, their associated provider visits plus unnecessary testing, a 15% failure rate and a low but appreciable rate of side effects, its very possible that the aggregate costs of BCPs could exceed any savings from a fewer number of unwanted pregnancies.
The WH Fact Sheet addresses this by saying that prior studies show.....
"...there was no increase in premiums when contraception was added to the Federal Employees Health Benefit System and required of non-religious employers in Hawaii. One study found that covering contraception saved employees $97 per year, per employee."
As far as "Hawaii" goes, the DMCB discovered that White House is quoting "empirical evidence" from a 2001 study from the states Insurance Commissioner. It describes the experience of four commercial health plans (anonymously named A, B, C and D) that went through a state-imposed contraceptive mandate. "A" already covered it, "B" saw a 14 cents per member cost of "contraceptive services and supplies" and "no material changes in eligible charges for maternity related services," "C" had a $1.50 increase in "contraceptive costs" and an approximate $7 decrease in maternity costs per 1000 members (which the Commissioner summarizes as of "little effect"), and "D" which had an 11.5% increase in pregnant members as the contraceptive mandate was implemented.
And where does the Fact Sheets "$97" savings figure come from? The DMCB suspects the number comes from Table 4 of a 2000 CDC and Washington Business Group on Health Report here which quotes scenario economic modeling of $562 vs. $659 per employee per year with and without a contraceptive benefit, respectively.
While it was thinking about the topic of economic modeling, the DMCB found this interesting 1996 study of the cost-effectiveness of family planning services for the British National Health Service. Based on a cost of £39 and "0.82" avoided pregnancies per year, the authors estimate that the NHS saved £754 "per avoided pregnancy." The DMCB suspects the White House would probably per to not quote this one.
The DMCBs conclusion: there is no real world evidence that oral contraceptives save any money by reducing claims expense. Any evidence that there are savings are based on methodologically suspect economic modeling and actuarial studies. While the good news is that BCPs probably wont increase insurance costs, the bad news is that it does little to tame health care inflation. Thats probably why this small recent survey of U.S. health insurers indicates that they dont believe it will save money either.
Two other DMCB points:
Given the experience in Europe, even if the mandate for contraceptive coverage wins this round, it will remain vulnerable to political and economic meddling... probably forever. Womens health deserves better.
BCPs are easy to prescribe. Given the likelihood of not enough PCPs to meet demand,it can be argued a physician office visit is unnecessary - which would further lower costs. It has also been argued that BCPs should be made available without a prescription, which begs the question of why this should be an "insurance benefit" in the first place.
Image from Wikipedia
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