Equity in Prescription Insurance
and Contraceptive Coverage

Nearly half of all pregnancies in the United States are unintended, and more than half of all unintended pregnancies end in abortion (Henshaw, 1998). Contraceptives have a proven track record of enhancing the health of women and children, preventing unintended pregnancy, and reducing the need for abortion. However, although contraception is part of basic health care for women, far too many insurance policies exclude this vital coverage.

In fact, while most employment-related insurance policies in the United States cover prescription drugs in general, the vast majority does not include equitable coverage for prescription contraceptive drugs and devices (Alan Guttmacher Institute [AGI], 1994). Similarly, while most policies cover outpatient medical services in general, they often exclude outpatient contraceptive services from that coverage (AGI, 1994). This failure is costly, both for insurers who may have to pay for either maternity care or abortion, and the families whose physical and financial well-being is threatened by unintended pregnancy and lack of access to equitable coverage for contraceptives.

Efforts were already underway to address the inequity in prescription coverage for women when Viagra^®, a drug to treat erectile dysfunction, was introduced on the U.S. market in the spring of 1998. Within two months of its entrance into the U.S. market, more than one half of the prescriptions for Viagra received insurance coverage. Such coverage has yet to be extended to intrauterine devices (IUDs) or diaphragms (Goldstein, 1998), prompting national organizations such as the American College of Obstetricians and Gynecologists and Planned Parenthood Federation of America to condemn the gender bias in prescription coverage.

In Congress:

In 1998, PPFA won a major legislative victory with the enactment of a contraceptive coverage requirement in the Federal Employees Health Benefits Plan (FEHBP). This provision is based on amendments to the Treasury-Postal Service appropriations bill (H.R. 4104), sponsored by Representative Nita Lowey (D-NY) in the House and Senators Olympia Snowe (R-ME) and Harry Reid (D-NV) in the Senate. The provision guarantees coverage of prescription contraceptive drugs and devices for federal employees by all plans participating in the FEHBP that cover other prescription drugs and devices. Contraceptive coverage for federal employees was again included in the FY 2000 Treasury and General Government Appropriations Act signed into law by President Clinton on September 29, 1999 (PL 106-58).

Last session, Senators Olympia Snowe (R-ME) and Harry Reid (D-NV) and Representatives James Greenwood (R-PA) and Nita Lowey (D-NY) reintroduced the Equity in Prescription Insurance and Contraceptive Coverage Act (EPICC) to provide equity in insurance coverage for contraception in the private market. The bill simply seeks to establish parity for contraceptive prescriptions and related medical services within the context of coverage already guaranteed by each insurance plan.

Under this legislation, plans already covering prescription drugs and devices would include equal coverage for prescription contraceptive drugs and devices. Also, plans that include coverage for outpatient medical services would include outpatient contraceptive services in that coverage. The bill defines contraceptive services as "consultations, examinations, procedures, and medical services, provided on an outpatient basis and related to the use of contraceptive methods (including natural family planning) to prevent an unintended pregnancy." (S. 1200, 1999; H.R. 2120, 1999)

In the States:

In 1998, Maryland became the first state to enact a law requiring health insurers to provide comprehensive coverage of all contraceptives approved by the U.S. Food and Drug Administration (Mantius, 1999). Since then, 11 more states — California, Connecticut, Delaware, Georgia, Hawaii, Iowa, Maine, Nevada, New Hampshire, North Carolina, and Vermont — have enacted contraceptive equity laws. Approximately half of all state legislatures have considered bills to improve insurance coverage of contraception each year since 1998. These bills generally require that insurers providing coverage for prescription drugs include coverage for FDA-approved prescription contraceptive drugs and devices—along with associated medical services such as exams, insertion, and removal.

While plans routinely cover other prescriptions and outpatient medical services, contraceptive coverage is meager or nonexistent in many insurance policies.

Half of indemnity plans and Preferred Provider Organizations (PPOs), 20 percent of Point of Service (POS) networks, and 7 percent of Health Maintenance Organizations (HMOs) cover no reversible contraception (AGI, 1994).
In 1998, less than two months after Viagra entered the U.S. market, more than half of all prescriptions received some insurance reimbursement. Overall coverage for oral contraceptives did not reach this level until they had been on the market for almost 40 years—coverage for diaphragms and IUDs still lags far behind (Goldstein, 1998).
Even plans that do provide some coverage typically do not cover all of the five most commonly used reversible contraceptive methods (oral contraceptives, the IUD, diaphragm, Norplant^® and Depo Provera^®). Less than 20 percent of traditional indemnity plans and PPOs, and less than 40 percent of POS networks or HMOs routinely allow women to choose among these five contraceptive methods (AGI, 1994).
Coverage of prescription drugs usually does not even include coverage for oral contraceptives, the most commonly used reversible contraceptive method in the United States. Although 97 percent of typical indemnity policies cover prescription drugs in general, only 33 percent include oral contraceptives in that coverage. This leaves two-thirds of typical indemnity plans covering "prescription drugs" but not the prescription so many women need access to—oral contraceptives (AGI, 1994).

Contraception is basic health care for women, and a critical contributor to improved maternal and child health.

Ready access to contraceptive-related health services increases the likelihood that the estimated 15 million Americans who contract sexually transmitted infections each year will be diagnosed and treated (Kaiser Family Foundation, 1998).
As they help women avoid unplanned pregnancies, contraceptive services help women plan pregnancies. A study of 45,000 women suggests that women who used family planning services in the two years before conception were more likely than women who had not used such services to receive early and adequate prenatal care (Jamieson & Buescher, 1992).
The National Commission to Prevent Infant Mortality estimated that 10 percent of infant deaths could be prevented if all pregnancies were planned—in 1989 alone, 4,000 infant lives could have been saved (1990).

Insurers have relied on women and their families paying out of pocket for contraceptive services and supplies, forcing financial decisions that may result in the use of less effective or less medically appropriate contraceptive methods.

Women of reproductive age currently spend 68 percent more in out-of-pocket health care costs than men (Women's Research and Education Institute, 1994). Much of the gender gap in expenses is due to reproductive health-related supplies and services.
The more effective forms of contraception are generally also the most expensive, often costing hundreds of dollars at the onset of patient use (AGI, 1994). Women and their families who must pay out of pocket may well opt for less expensive and sometimes less effective methods, increasing their risk for unintended pregnancies.
Cost analyses have shown that if health insurance policies were to include coverage for these contraceptive supplies, costs to employers would be minimal - as little as $1.43 per employee per month (Darroch, 1998).

The correlation is clear. Contraception prevents unintended pregnancy, helps women plan their pregnancies, and reduces the need for abortion.

In any single year, 85 of 100 sexually active women of reproductive age not using a contraceptive method become pregnant. In contrast, of 100 oral contraceptive users, only between 0.1 and 5 percent become pregnant during the first year of use (Trussell, et al., 1998).
Because the likelihood of pregnancy is so great when contraception is not used, 53 percent of all unintended pregnancies in the U.S. occur among the 10 percent of fertile women who use no method and leave pregnancy to chance (Harlap, et al., 1991).
Reducing unintended pregnancy is key to reducing the number of abortions—more than half of unintended pregnancies end in abortion (Henshaw, 1998).

Current as of June 2000.

Cited References

Alan Guttmacher Institute (AGI). (1994). Uneven and Unequal: Insurance Coverage of Reproductive Health Services. New York: The Alan Guttmacher Institute.

Darroch, Jacqueline. (1998). Cost to Employer Health Plans of Covering Contraceptives. New York: The Alan Guttmacher Institute.

Equity in Prescription Insurance and Contraceptive Coverage Act of 1997, S. 743, 105th Cong., 1st Sess. (1997).

Goldstein, Amy. (1998, May 20). "Viagra's Success Fuels Gender Bias Debate: Birth Control Advocates Raise Issue." Washington Post, p. A1.

Harlap, Susan, Kathryn Kost and Jacqueline Darroch Forrest. (1991). Preventing Pregnancy, Protecting Health: A New Look at Birth Control Choices in the United States. New York: The Alan Guttmacher Institute.

Henshaw, Stanley K. (1998). "Unintended Pregnancy in the United States." Family Planning Perspectives, 30(January/February):24-29.

Jamieson, Denise J. and Paul A. Buescher. (1992). "The Effect of Family Planning Participation on Prenatal Care Use and Low Birth Weight," Family Planning Perspectives, 24 (September/October):214-218.

Kaiser Family Foundation. (1998). Sexually Transmitted Diseases in America: How Many Cases and at What Cost? Menlo Park, CA: Kaiser Family Foundation and the American Social Health Association.

Mantius, Peter. (1999, April 20). "Health Agency Created As Barnes Combines Divisions." Atlanta Constitution, p. C2.

National Commission to Prevent Infant Mortality. (1990). Troubling Trends: The Health of America's Next Generation. Washington, D.C.: NCHM.

PL 58, 106th Cong., 1st sess. (September 29, 1999). Treasury and General Government Appropriations Act, 2000.

Postrel, Virginia. (1999, May 31). "Sex Mandates Looking Forward." Forbes, p. 121.

Trussell, James et al. (1998). Contraceptive Technology, 17^th ed. New York: Ardent Media.

Women's Research and Education Institute. (1994). Women's Health Care Costs and Experiences. Washington, D.C.: WREI.