The Alan Guttmacher Institute (AGI) and the Henry J. Kaiser Family Foundation (Kaiser) recently published a report titled Medicaid: A Critical Source of Support for Family Planning in the United State. The report highlighted the crucial role of Medicaid in accessing family planning as well as other key issues in the Medicaid debate.

Medicaid purchases health care for millions of low-income uninsured Americans. Over the past two decades, it has become our nation’s largest public funding source for family planning services and supplies, with roughly 6.5 million women of reproductive age (15 to 44) relying on Medicaid to finance their health care, including family planning, in 2002.¹

Access to these family planning services may be in jeopardy due to rising debate fueled by current economic conditions and the significant cost of Medicaid, which is financed by both federal and state dollars. States determine their own level of spending for Medicaid, which represents roughly one out of every five dollars of their total budget.² The federal government reimburses states for part of their spending, and the rate of federal reimbursement, or the "matching rate," varies by state. With these matching rate payments, which range from 50-77%, the federal government funds over half of all Medicaid spending. It has become the largest single source of federal support to states.³

Fiscal pressure led the Bush administration to propose limiting federal Medicaid payments, and all 50 states and the District of Columbia implemented Medicaid cost containment measures in 2003. To slow rising Medicaid costs, states have reduced or frozen provider payments and limited prescription drug spending. Many have restricted eligibility, reduced benefits, and added or increased co-payments.⁴ These measures come at a time when, following a decline in the late 1990s, more Americans, including women of reproductive age, are enrolling in Medicaid.⁵

Medicaid expanded to include family planning services and supplies in 1972, seven years after the introduction of the program. This coverage extends to all "individuals of child-bearing age who are eligible under the State plan and who desire such service and supplies."⁶ Recognizing the importance of family planning, Congress also approved a special matching rate for these services and supplies. The federal government covers 90% of family planning costs, which is significantly higher than the 50-77% rate states are generally reimbursed for services.

To qualify for the 90% matching rate, services must be distinctly related to family planning. The Center for Medicare and Medicaid Services (CMS), the Health and Human Services department that administers Medicaid, has set forth broad guidelines for the financing of family planning services and supplies. In general, contraceptives, gynecological exams, and tests for cervical cancer and sexually transmitted diseases (STDs) are covered in state programs. However, certain services are not. For example, screening for an STD that occurs during a regular family planning exam is covered at the 90% rate, but follow-up treatment is not.

This AGI/Kaiser study illustrates how these guidelines also impact other Medicaid benefits for family planning such as cost-sharing, which refers to when patients must pay out-of-pocket costs for services. Typically, Medicaid beneficiaries must bear certain out-of-pocket costs, such as co-payments. Yet all services and supplies classified as family planning are exempted from this requirement. This exception, however, is not always honored. A previous AGI study, conducted in 1996, found that a small number of managed care plans charge Medicaid beneficiaries for these services.⁷

Managed care plans also cause difficulty for women when choosing their family planning provider. Medicaid beneficiaries have the freedom to choose any Medicaid provider for family planning services, and those in managed care plans can select one within or outside of the plan. Yet, many women do not take advantage of this benefit, for several reasons, including CMS guidelines for family planning and lack of information regarding their ability to seek outside care.⁸

Managed care plans are increasingly significant to family planning, as 82% of women on Medicaid access medical care through managed care.⁹ In addition to cost-sharing and choice of provider issues, these plans can cause other complications in accessing family planning services. Whether religious or not, managed care plans, under the protection of a 1997 federal law, may choose not to provide or reimburse services based on moral or religious grounds.¹⁰

In addition to examining the impact of managed care plans, the AGI/Kaiser study also looked at how access to family planning services and supplies can be greatly enhanced by Medicaid waivers. With rising health care costs, waivers can expand coverage to women who cannot afford private insurance yet do not qualify for Medicaid. Waivers have also proven to be cost-effective. CMS recently commissioned a study of six family planning waiver programs, and all six have "resulted in significant savings to both the federal and state governments."¹¹

The AGI/Kaiser report concludes by reminding us that the research is clear: public spending on family planning programs is cost-effective. Every one dollar spent on public family planning services saves three that the government would spend for pregnancy and newborn care in the Medicaid program.¹²

Publicly funded family planning programs are proven to be effective as well. Each year, these programs help 1.3 million women avoid an unintended pregnancy.¹³ The total U.S. abortion rate could be 40% higher without publicly funded family planning programs, and this estimate increases for the teenage population.¹⁴

Overall, Medicaid plays a vital role for low-income women in accessing family planning services and supplies. The report contends that as federal and state governments debate changes to Medicaid over the coming years, the special status for family planning must be preserved.

For more information on the report please see http://www.guttmacher.org/pubs/medicaid050304.html and http://www.kff.org/womenshealth/7064.cfm.

Update written by Alissa Fishbane, SIECUS Intern.

References

1. The Alan Guttmacher Institute, special tabulations of data from the Current Population Survey, 2003.
2. National Governors Association and National Association of State Budget Offices, The Fiscal Survey of the States, June 2003.
3. D. Rowland, Medicaid: Issues and Challenges, the Kaiser Commission on Medicaid and the Uninsured, testimony before Subcommittee on Health, Committee on Energy and Commerce, U.S. House of Representatives, October 8, 2003.
4. V. Smith, et al., States Respond to Fiscal Pressure: State Medicaid Spending Growth and Cost Containment in Fiscal Years 2003 and 2004, The Kaiser Commission on Medicaid and the Uninsured, September 2003.
5. The Alan Guttmacher Institute, special tabulations of data from the Current Population Survey, 2003.
6. Section 1905(a)(4)(C) of the Social Security Act.
7. R.B Gold, J.E Darroch, and J.J. Frost, "Mainstreaming Contraceptive Services in Managed Care-Five States’ Experiences," Family Planning Perspectives, September/October 1998, pp. 204-211.
8. R. B. Gold and C.L. Richards, Improving the Fit: Reproductive Health Services in Managed Care Settings, The Alan Guttmacher Institute, 1996.
9. A. Salganicoff et al., Kaiser Women’s Health Survey, (Menlo Park, CA: Kaiser Family Foundation, 2001).
10. Section 1932(b)(3)(B) of the Social Security Act.
11. J. Edwards, J. Bronstein,, and K. Adams, "Evaluation of Medicaid Family Planning Demonstrations," The CNA Corporation, CMS Contract No. 752-2-415921, November 2003.
12. J.D. Forrest, and R. Samara, "Impact of Publicly Funded Contraceptive Services on Unintended Pregnancies and Implications for Medicaid Expenditures," Family Planning Perspectives, September/October 1996, pp. 188-195.
13. Ibid.
14. The Alan Guttmacher Institute, "The Impact of Publicly Funded Family Planning," Issues in Brief, October 1996.