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Release: April 17, 1995
Contact: Tom Krattenmaker (609/258-5748)


Princeton Researcher Finds
Health Care Providers Could
Reap Savings By Covering
Contraception

PRINCETON, N.J. -- A minority of American health care plans cover
all reversible prescription contraceptives, but new research by a
Princeton University professor and several co-authors indicates
that more complete contraceptive coverage pays off in considerable
savings for insurers.

James Trussell and co-authors, in an article appearing in the
April issue of the _American Journal of Public Health_, report
that care providers save thousands of dollars in costs for every
unintended pregnancy avoided through use of contraceptives.

A year's worth of oral contraception for a typical health plan
enrollee costs roughly $420 (including the cost of the unintended
pregnancies that result from contraceptive failure), according to
data compiled by the authors. By comparison, a sexually active
woman who uses no contraception costs the care provider an average
of $3,225, considering the 85 percent likelihood that she will
have an unintended pregnancy over a year's time. The average cost
of an unintended pregnancy is about $3,800, reflecting the
relative frequency of the four possible outcomes: a term
pregnancy, an ectopic pregnancy, an induced abortion, or a
spontaneous abortion. All of these are typically covered by health
plans.

"Insurers will pay for unintended pregnancies while, with the
exception of poor women who receive government subsidies,
individuals by and large are left to pay for their own
contraceptives, " Trussell says. "Providers are basically betting
on women taking these preventive steps on their own. Considering
how much more it costs to respond to an unintended pregnancy, it
is a very illogical incentive system."

Trussell and his fellow researchers cite data showing that fewer
than 20 percent of large-group indemnity plans and preferred
provider organizations -- and fewer than 40 percent of point-of-
service networks and HMOs -- routinely cover the five most common
reversible contraceptive methods that require a prescription.
Those five are oral contraceptives, implants, injectables, IUDs,
and diaphragms.

Virtually none cover non-prescription methods of contraception,
such as condoms and spermicides.

To measure the cost-effectiveness of different methods of
contraception, the researchers constructed an elaborate economic
model, using data from a national claims data base and Medi-Cal.
The model takes into account: the cost of acquiring and using the
method, the cost of unintended pregnancies resulting from
contraceptive failure, and the cost of treating medical side
effects of the various methods, such as the higher incidence of
urinary tract infections among diaphragm users. A major conclusion
is that the upfront acquisition costs are inaccurate predictors of
the total economic cost of the competing contraceptive methods.

The researchers concluded that of the 15 contraceptive methods
available in the United States, the four most cost-effective are
vasectomies, copper-T IUDs, implants, and injectables. According
to the model, each would save an insurer more than $13,000 per
patient over a five-year period. That's the difference between the
cost of the contraceptive and the cost of the 4.2 unintended
pregnancies prevented over the five years.

Because of their higher failure rates, barrier methods,
spermicides, withdrawal and periodic abstinence are less cost-
effective, according to the study. But they still save care
providers between $8,933 and $12,239 over the five years.

Falling between those two groups are oral contraceptives, which,
according to the researchers, prevent 4.1 pregnancies over five
years, thus saving $12,879.

"The message is simple," the authors conclude. "Regardless of
payment mechanism or contraceptive method, contraception saves
money. Preventing unintended pregnancies is highly cost-
effective."

Trussell's co-authors are Joseph A. Leveque, Michael J. Strauss
and Jacqueline D. Koenig of Health Technology Associates; Robert
London of Kaiser Permanente Medical Group; Spencer Borden of the
Wyatt Co.; Joan Henneberry of the Colorado Department of Health;
Katherine D. LaGuardia of Cornell University Medical College;
Felicia Stewart of the U.S. Department of Health and Human
Services; T. George Wilson of the California Department of Health
Services; and Susan Wysocki of the National Association of Nurse
Practitioners in Reproductive Health.

Note: Contact Princeton's communications office at the above
number to arrange an interview with Trussell or to obtain a copy
of the study or an accompanying editorial.

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