After the White House announced a rule mandating employers to offer contraception as part of their health insurance plans, officials added an accommodation permitting religiously affiliated institutions to opt out of the requirement. Under the rule, insurance companies would offer the benefit directly to the employee. That way, all women would have access to birth control, institutions avoid compromising their moral beliefs and insurance companies could avoid the costs of unintended pregnancies or medical complications.
But when Health and Human Services Secretary Kathleen Sebelius explained the economics of expanding access to birth control to Rep. Tim Murphy (R-PA) at a House Energy and Commerce Committee on Thursday, the Congressman was shocked:
MURPHY: So you’re saying by not having babies born, we’re going to save money on health care?
SEBELIUS: Providing contraception as a critical preventive health benefit for women and for their children reduces health care.
MURPHY: Not having babies born is a critical benefit? This is absolutely amazing to me.
In an interview with Fox News about his confrontation with Sebelius, Murphy disagreed with Sebelius’ assessment:
MURPHY: When Secretary Sebelius said that basically pregnancy is an expense, that means that by not having to pay for prenatal care and not having to pay for labor and delivery or the pediatric costs of raising a child, they figured they could save a lot of money. And it really baffled me how we were going to expect to pay for health care by not having babies. I thought that was one of the points of providing health care for women. And quite frankly it doesn’t make sense financially.
The “financial” logic is sound. A study from 2000 estimated that it costs employers 15 to 17 percent more to not provide contraceptive coverage to employees than it would if the insurance coverage included the benefit. This higher spending accounts for the direct medical costs of a pregnancy and indirect expenses like employee absence and reduced productivity.