Thousands of Australians have missed out on assisted reproductive treatment since the Federal Government changed funding in 2010, resulting in the loss of 1500 babies that would have otherwise been born.
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An analysis of Medicare data by the University of NSW found that while use of assisted reproductive technologies increased about 10 per cent each year between 2004 and 2009, it dropped 13 per cent last year when the Federal Government capped the amount of money Medicare reimbursed patients for procedures.
In vitro fertilisation, or IVF, is the most common assisted reproductive technology in Australia. It costs about $7000 to $8000 per cycle. Depending on a woman's age and the treatment provided, there is about a 20 per cent chance of each cycle resulting in a birth. However, the younger a woman is, the higher the percentage chance of success.
Georgina Chambers, from the university's Perinatal and Reproductive Epidemiology Research Unit, said the analysis showed that based on treatment trends before 2010, about 7000 IVF cycles were not undertaken last year because of the policy change. This meant about 1500 babies that would have been conceived through assisted reproductive technologies last year were not born.
She said the modelling was adjusted to account for a large group of women who brought forward their treatment to the last quarter of 2009 in anticipation of the Medicare changes last year.
Under the policy change, which began in January 2010, patients and doctors said out-of-pocket costs doubled from about $1000 to $2000 per cycle.
The change also meant patients had to pay the full cost of each cycle up front before their treatment, with Medicare reimbursing about half of the cost at the end of a patient's 30-day cycle.
Dr Chambers said the modelling showed the Federal Government had saved about $54million last year as a result of the new Medicare arrangements - about $30,000 per baby that would have been born.
These savings could be misleading though, she said, given overseas studies had shown about an eight-fold return on investment into assisted reproductive technologies when future tax revenue from each child is taken into account.
''Assisted reproductive treatment is not only important in terms of creating families, but its value should be considered from a broader societal perspective,'' she said.
Dr Chambers said although her study was yet to be completed, the drop in use was most common among women aged 34 to 37 - a group highly likely to benefit from the treatment and achieve successful pregnancies.
She said ongoing analysis would determine whether the effect of the policy change on women would continue this year.
University of NSW's School of Women's and Children's Health chief and IVF specialist Professor Michael Chapman said the increasing expense may have also led to an increase in the number of patients having multiple embryos transferred per cycle to increase the chance of twins and triplets.
''At IVF Australia [Professor Chapman's clinic], the multiple pregnancy rate was 5 per cent in 2009 and it went up to 6.5 per cent in 2010,'' he said.
This was a worrying trend because multiple pregnancies increased the risk of complications. ''There is twice the risk of a baby dying in a twin pregnancy than in a single pregnancy and the chance of cerebral palsy is four times that of a single pregnancy ... The other side of that is that multiple pregnancies cost the taxpayer about seven or eight times the cost of a single pregnancy because of neonatal intensive care costs,'' he said.
A spokesman for Health Minister Nicola Roxon said she stood by the changes to Medicare funding, which was prompted by specialists charging excessive fees.
Despite increasing costs, Professor Chapman said specialists had not increased their fees in the last two years.