Working Paper: NBER ID: w12820
Authors: M. Kate Bundorf; Melinda Henne; Laurence Baker
Abstract: During the last two decades, the treatment of infertility has improved dramatically. These treatments, however, are expensive and rarely covered by insurance, leading many states to adopt regulations mandating that health insurers cover them. In this paper, we explore the effects of benefit mandates on the utilization and outcomes of infertility treatments. We find that use of infertility treatments is significantly greater in states adopting comprehensive versions of these mandates. While greater utilization had little impact on the number of deliveries, mandated coverage was associated with a relatively large increase in the probability of a multiple birth. For relatively low fertility patients who responded to the expanded insurance coverage, treatment was often unsuccessful and did not result in a live birth. For relatively high fertility patients, in contrast, treatment often led to a multiple, rather than a singleton, birth. We also find evidence that the beneficial effects on the intensive treatment margin that have been proposed in other studies are relatively small. We conclude that, while benefit mandates potentially solve a problem of adverse selection in this market, these benefits must be weighed against the costs of the significant moral hazard in utilization they induce.
Keywords: health insurance; infertility treatments; mandated benefits; moral hazard; adverse selection
JEL Codes: I1
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| Mandated health insurance coverage for infertility treatments (I13) | Greater utilization of infertility treatments (J13) |
| Greater utilization of infertility treatments (J13) | Higher probability of multiple births among low fertility patients (J13) |
| Mandated health insurance coverage for infertility treatments (I13) | Higher probability of multiple births among low fertility patients (J13) |
| Utilization of infertility treatments (J13) | No significant increase in overall number of deliveries for high fertility patients (J13) |
| Mandated health insurance coverage for infertility treatments (I13) | Increased utilization without proportional increases in successful outcomes (O49) |