Managed health care coverage for infertility services: understanding adverse selection

Area of Science:

• Health Economics
• Insurance Markets
• Reproductive Health

Background:

• Infertility is often viewed as a social issue, not a medical one, leading to reluctance in insurance coverage.
• Lack of data on cost-effectiveness and care sequencing has hindered insurance inclusion for fertility services.
• Some health plans experienced negative financial results due to adverse selection when covering infertility.

Purpose of the Study:

• To explore the economic viability of insurance coverage for infertility services.
• To identify strategies for mitigating adverse selection in fertility insurance.
• To assess the potential for a private sector insurance market for infertility care.

Main Methods:

• Analysis of insurance economic principles and risk management.
• Examination of adverse selection mechanisms in insurance.
• Review of private sector strategies to control adverse selection.
• Consideration of government mandates and their impact on insurance markets.

Main Results:

• Adverse selection occurs when individuals with higher anticipated need for services have private information, impacting insurer risk.
• Private sector strategies like limited coverage, experience rating, and group coverage can reduce adverse selection.
• Government mandates can increase coverage but may not fully resolve adverse selection if high-risk individuals relocate.
• Societal acceptance of universal infertility coverage is a prerequisite for a stable insurance market.

Conclusions:

• An economically beneficial insurance market for infertility services is achievable.
• Private sector insurers can offer fertility coverage by effectively managing adverse selection.
• A combination of private sector innovation and potentially government support may be needed for widespread, sustainable coverage.