Swedish Study: Economic and Social Costs of Infertility
Infertility is a common health issue impacting millions of individuals and couples worldwide. The World Health Organization estimates that as many as 1 in 6 people of reproductive age are affected by infertility. While assisted reproductive technologies like in-vitro fertilization (IVF) have advanced dramatically in recent decades, access to these treatments remains controversial and varies widely across countries. A new working paper (The Economics of Infertility: Evidence from Reproductive Medicine by Sarah Bögl, Jasmin Moshfegh, Petra Persson, and Maria Polyakova) uses comprehensive administrative data from Sweden to shed new light on the prevalence of infertility, its impacts on well-being, and how insurance coverage influences access to treatment.
Prevalence of Infertility and Treatment Success
The researchers find that infertility is quite common in Sweden. Nearly 8% of childless women aged 16-45 initiated infertility treatment between 2006-2019. Among those who are still childless at age 31, 11-16% experience infertility and seek treatment by the end of their fertile years, with higher rates among higher-income women.
The authors develop a measure of infertility based on prescription drug purchases to capture the universe of treated medical infertility. They find that the use of more expensive and intensive treatments is greater among higher-income women. While low-intensity treatments (LIT) like medication and insemination were more common early on, IVF use has grown steadily. By 2018, twice as many women were initiating IVF compared to LIT.
The good news is that assisted reproductive technologies are highly effective at the population level. Within 8 years of initiating any infertility treatment, 79% of women give birth. However, a quarter still remains infertile. 60% of women start with LIT, while 40% go straight to IVF. Among LIT starters, 42% eventually progress to IVF. Overall, 15% undergo IVF and still don't have a child within 8 years.
Success rates are similar between low-intensity treatments like medication and insemination vs high-intensity treatments like IVF. This likely reflects the appropriate matching of patients to treatments based on medical factors like age and underlying infertility causes.
Private Costs of Infertility
To estimate the impact of infertility on well-being, the authors leverage the fact that after an assisted conception, some pregnancies fail due to largely random factors like chromosomal abnormalities. This allows comparing outcomes for women based on the quasi-random outcome of their first assisted pregnancy.
They find that compared to women whose first assisted conception is successful, those who remain infertile are:
48% more likely to take mental health medications in the long run
6 percentage points more likely to get divorced
No better off in terms of long-run income, despite avoiding the typical large earnings drop after childbirth
Male partners of infertile women also have worse mental health and around 4% lower long-run earnings. These results contrast the notion that having children makes couples less happy and productive. Instead, among those who want children, not being able to have them takes a major toll on mental well-being and relationships, with no protective effect on careers.
Willingness to Pay for Treatment
Given the high non-monetary costs of infertility, one might expect a high willingness to pay for treatment. The researchers estimate this using sharp discontinuities in Sweden's public IVF insurance coverage based on age cutoffs that vary across regions and over time.
When eligible, women pay very low out-of-pocket costs for 3 IVF cycles. However, the price jumps to 190% of the median monthly income for one cycle after passing the age cutoff. Due to wait times, women close to the cutoff can't perfectly time their treatment start to avoid aging out of coverage.
The authors find demand is quite sensitive to price - IVF rates drop by half when women lose coverage. The implied maximum willingness to pay at median income is 2.7 months of income, or 22% of annual disposable income, for one IVF cycle (a 30% chance of birth). There is no change in the success rate of IVF at the coverage discontinuity, indicating women aren't selecting out of treatment based on their chances of success when price increases.
Importantly, price sensitivity is much greater for lower-income women. For those in the bottom income decile, one IVF cycle costs over half a year of disposable income, while it's less than a month of income for the top decile. The researchers estimate that at least 40% of the drop in IVF when losing coverage reflects a lack of liquidity to pay the large upfront cost, rather than a low valuation of children.
This suggests that in the absence of full insurance, many lower-income couples may be unable to access IVF due to credit constraints, even if they are willing to pay the cost over a longer horizon. The limited income gradient in the likelihood of having a biological child, where affordability is not a barrier, further indicates the differential response to price is unlikely to be driven solely by differences in preferences for children.
Implications for Policy
Insurance coverage for IVF not only increases access to treatment but also shapes the socioeconomic distribution of children born as a result. The researchers estimate that with no age restrictions, insurance would increase IVF births by 28% compared to the current policy in Sweden, and by 84% compared to having no coverage.
Notably, expanding coverage would increase births much more for lower-income women. With the current age-limited subsidy, there are 70% fewer IVF births among below-median-income women compared to a counterfactual of no age cutoffs. In contrast, there are only 21% fewer births among above-median income women.
As societies continue to debate the merits of subsidizing infertility treatment, this research provides valuable new evidence on the issue. It suggests that infertility imposes major costs on couples, both financially and in terms of well-being. Insurance coverage is important for enabling access to treatment, especially for lower-income families who may otherwise be unable to afford it.
However, subsidies don't just impact access - they also shape which couples ultimately have children. More restrictive policies mean fewer births overall and a higher income profile of parents. Policymakers should consider these distributional implications in addition to cost-benefit considerations around government spending and moral hazard.
Ultimately, infertility treatments allow thousands of couples to fulfill their desire to have children. While the technology keeps advancing, this research highlights that regulating and funding access is just as crucial in determining utilization and who benefits. Societies will have to grapple with their willingness to bear the expense of helping families overcome infertility and the implications for equity and the composition of the next generation.