Feasibility of Family Planning Services Inclusion within Public and Private Employers Health Insurance Plans

Dr. Mohammed TarawnehCertified Actuary and Risk Analyst

September 19, 2011

Introduction

• If a woman is sexually active between ages 22.4 and 45 and wants 3-4 children, she will spend 13-16 years needing to use contraception and 7-9 years either trying to become pregnant or being pregnant or postpartum.

• Cost of contraceptive services during this period affects which medical provider women go to and even the methods they choose. Of course, method use and method choice have direct effects on whether or not a woman will have an unintended pregnancy, the costs of which are usually covered by employer health insurance. This makes contraceptive use a relevant issue for employers interested in reducing health care costs.

Objective

The primary objective is to evaluate the economic feasibility to Jordan public- and private-sector employers of extending the scope of coverage of their health insurance plans to include contraception methods

Methodology

Concept:

Neither employers, nor insurance companies know about the extra costs of providing contraception coverage as part of their health insurance plans or, the benefits they might gain out of it. This study focuses primarily on the costs of providing contraception coverage as an insured service, the benefits that may be gained from this provision of

service and the feasibility of such a provision .

Methodology

Benefits and Costs:One type of costs against three types of expected

benefits: • Cost of providing contraception service coverage • Savings in medical costs of “pregnancy and delivery” • Savings in productivity costs resulting from maternity

leave and sick leave of pregnant employees• Savings in insurance premium costs resulting from the

reduction in the number of insured dependent children

Methodology

Study Scenarios:• The “current” scenario deals with the current

level of contraception prevalence• The “future” scenario deals with the expected

future level of contraception prevalence

Methodology

Data Collection (Surveys):Three field surveys were conducted:• Employers Survey: 100 larger employers were surveyed

to collect data about the particulars of employers health insurance plans

• Providers Survey: 60 Gynecologists were surveyed to collect data about the various cost constituents of providing contraception services

• Insurance Companies Survey: 10 insurance companies were surveyed to collect data about the various cost constituents of pregnancy and delivery care

Methodology

Study Analyses:The most prevalent forms of economic

evaluation techniques were used:• Cost-benefit analysis• Cost-effectiveness analysis

Results- Employers Survey

• Employer plans generally cover dependent spouses and children

• Coverage is generous; includes inpatient and outpatient services

• Annual coverage cost per person is 260 JDs shared at 79%-21% employer-employee

• Insured patient co-pay: 2% inpatient, 12 % out• Employer health plans do not cover contraception• Majority of employers are willing to pay up to 3%

extra premium to cover contraception

Results- Providers Survey

• IUD Device costs 20-27 JDs; insertion 25-30 JDs; extraction 15-20 JDs; protection duration 3-4 years

• 3-month Depo Provera Injection costs 6-7 JDs• 1-month supply of the Combined Pill costs 5-6 JDs • Noristerat Implat Capsule costs 23-33 JDs; insertion

16-20 JDs; extraction 18-23 JDs• Female sterilization surgery costs 400-500 JDs • Male condom costs 0.15-1.00 JDs

Results- Insurers Survey

• A typical pregnant woman makes 9-10 clinic visits• Clinic charges, prescription drugs, lab and other

exams cost 32-42 JDs per visit • A normal delivery case costs nearly 400-500 JDs• A cesarean delivery costs nearly 750-850 JDs• Treatment of a new-born baby costs nearly 50-65 JDs

• All insurers exclude contraception coverage from

health insurance contracts• All insurers are willing to add contraception coverage

to their insurance contracts

Results- Methods Effectiveness

• Modern methods effectiveness 90-100%• Traditional methods effectiveness 50%.

• Under current prevalence rates in Jordan:• Modern methods effectiveness 96.1%• All methods effectiveness 82.6%

Results- Cost Effectiveness

Cost-effectiveness is the cost per pregnancy avoidedAll methods are highly cost-effective• IUDs 8.6 JDs annually• Implants 10.1 JDs annually• Injectables 27.7 JDs annually• Female Steril. 73.5 JDs annually• Pill 87.4 JDs annually • Condoms 96.1 JDs annually• All Modern Methods 42.0 JDs annually.

Results- Contraception Cost

At the “current” and “future” contraception prevalence rates in Jordan, annual cost is:

• 34.0 JDs per modern contraception user • 7.1-8.8 JDs per employee • 13.5-16.6 JDs per currently married woman of

reproductive age • 2.8-3.5 JDs per insured person• 1.1-1.6% increase in overall health insurance

plan cost

Results- Contraception Savings

Avoidance of a single “unwanted” pregnancy is expected to save a health plan:

• 809 JDs in medical costs (3.5 JDs per insured person per year)

• 798 JDs in productivity costs (1.0 JD per insured person per year)

• Avoidance of unwanted pregnancies will reduce the number of insured dependent children and, thus the total plan insured members (10 JDs per insured person per year).

• Total savings 14.5 JDs per insured person per year

Results- Benefits to Costs

• A 3.5 JDs investment in contraception provision on behalf of each insured person will pay back 14.5 JDs per insured person annually.

• This is equivalent to a benefit-to-cost ratio of 4.2

Thank You