FACT SHEET
Affordable
Birth Control
General Overview
Since January 2007, more than 3 million college students and
hundreds of thousands of low-income women have lost access to affordable birth
control. This crisis was caused by a provision in the 2005 Deficit Reduction
Act (DRA) which - by all accounts - unintentionally cut off every college and
university health center and hundreds of safety-net providers from access to
low-cost drugs. A no-cost technical fix (S. 2347 / H.R. 4054) should be passed
immediately to correct this mistake and restore affordable birth control to
these populations.
Why did Congress Encourage Pharmaceutical Companies to Offer These
Prices to Safety-Net Providers?
In 1990, Congress passed the Medicaid Anti-Discriminatory Drug
Price and Patient Benefit Restoration Act to ensure that Medicaid receives the
lowest drug prices in the marketplace. Congress intentionally protected the
practice of pharmaceutical companies offering charitable organizations and
clinics nominally-priced drugs. This voluntary, charitable practice was
encouraged because it helped ensure access to affordable birth control for
millions of low-income women, at no cost to the federal government. Moreover, Congress knew that allowing
companies to continue this private practice helped avoid costs of unintended
pregnancies that would otherwise fall to the government. For decades, pharmaceutical
companies have been providing low-cost birth control to safety-net family planning
providers and university health centers.
How did the provisions in the DRA change this law?
In 2005, Congress became concerned that manufacturers were selling
nominally priced drugs to some entities and for some purposes beyond the intent
of the 1990 Act, thereby driving up the best price (a term of art for drug
pricing) and lowering the amount of rebates manufacturers pay states for
Medicaid drugs. Accordingly, the DRA included a provision that sought to
restore the original intent of the Act to limit nominal drug sales to the kinds
of charitable organizations and entities that help to make up the health care
safety-net.
The provision specifies four categories of providers that are
eligible for nominally priced drugs:
(I) a covered entity described in section 340B(a)(4) of the Public
Health Service Act (including Title X health
clinics)
(II) an intermediate care facility for the mentally retarded
(III) a state-owned or operated nursing facility
(IV) any other facility or entity that the secretary determines is
a safety-net provider to which sales of such drugs at a nominal price would be
appropriate based on the factors described in clause.
Preliminary Impact on Providers and their Patients
Safety-Net Providers
While the majority of family planning clinics remained eligible
for nominal drugs under category (I), approximately 200 of Planned
Parenthood’s 860 health centers and another 200 family planning or community
health centers lost their ability to purchase low cost contraception. These
health centers provide the same types of services to the same population base
as the other centers, but do not receive Title X funding. We estimate that
these health centers treat roughly 500,000-750,000 low-income women in 36
states each year. The increase in birth control pricing is having a devastating
impact on the ability
of health centers to provide critical health care services to
low-income patients. Because this increased cost cannot be passed on to
low-income clients, the health centers have been forced to cut back on other services,
such as prenatal care and cervical cancer testing and treatment, in an effort
to accommodate the rising cost of birth control. These are the very services
the 1990 Act sought to protect.
College and University Health Centers
Colleges and university health centers were entirely cut out of
this program by the DRA. As a result, the price of birth control has risen
dramatically at all 1,370 college and university health centers nationwide. Three
million undergraduate students have seen their birth control prices skyrocket,
from $5 or $10 up to $40 or $50 per month. In some cases, college health
centers have stopped providing oral contraceptives altogether.
Impact on the Lives of Struggling College Students and Low-Income
Women
For many students and low-income women, access to birth control is
now out of reach financially. Colleges and Universities report a drop in the
use of regular oral birth control. As a result, we anticipate an increase in
unintended pregnancies and abortions among this population until access to
affordable birth control is restored. With the increased rates of unintended
pregnancy, education and opportunities are jeopardized.
CMS has Failed to Implement the Law Appropriately
Under the new law, Congress anticipated that it might not have
captured all entities to whom sales of nominal drugs would be appropriate, and
authorized the Secretary of Health and Human Services to designate other
entities as “safety-net providers” for whom it would be appropriate
to offer nominally priced drugs. According to the
Immediate Congressional Action Is Needed
Bipartisan agreement has been reached on legislative language that
will address the inadvertent exclusion of health centers that provide the same
services to the same populations as those clinics that receive 340B funding, as
well as college health centers. The no-cost resolution to this crisis, the Prevention
Through Affordable Access Act (S.2347 / H.R. 4054), has over 180 bipartisan
house and senate cosponsors. It is critical that this provision be passed to
correct this unintended anomaly and restore affordable birth control to
university students and low-income women once again.
This information was
compiled by Planned Parenthood's Government Relations Department (
For more information about
legislation related to reproductive health, or to join our action alert
network, log onto http://www.ppawi.org