The Impact of Insurance Coverage on Utilization of Prescription Contraceptives: Evidence from the Affordable Care Act : Insurance Coverage and Prescription Contraceptives

We estimate how cost sharing, the portion of the bill the patient pays, affects the demand for medical services. The data come from a randomized experiment. A catastrophic insurance plan reduces expenditures 31 percent relative to zero out-of-pocket price. The price elasticity is approximately -0.2. We reject the hypothesis that less favorable coverage of outpatient services increases total expenditure (for example, by deterring preventive care or inducing hospitalization).

The rate of teenage pregnancy in the United States is higher than in other developed nations. Teenage births result in substantial costs, including public assistance, health care costs, and income losses due to lower educational attainment and reduced earning potential.