A statewide group of health care leaders, called the Birth Outcomes Initiative, has managed to reduce the number of early elective infant deliveries in South Carolina since 2011, according to a new report published Thursday.

The reason is simple. The two largest insurers in the state — BlueCross BlueShield of South Carolina and the Medicaid agency — stopped paying for them. In January, hospitals and doctors in South Carolina were no longer reimbursed for inducing delivery before 39 weeks gestation without a good medical reason.

“When you have an elective induction, that’s starting labor before God had intended,” explained Dr. Laura Long, BlueCross BlueShield of South Carolina’s chief medical officer and a member of the Birth Outcomes Initiative. Research shows inducing delivery even half a day early can compromise an infant’s health and development.

According to the report published this week by the nonprofit group Catalyst for Payment Reform, “South Carolina was the first state in the nation to have its Medicaid program partner with the largest local commercial insurer to adopt such a non-payment policy.”

The South Carolina Medicaid agency is a paying member of the Catalyst for Payment Reform group. Although the agency did not pay for this study, at least one Medicaid agency employee vetted early versions of the report before it was officially published.

The report shows that the initial efforts of the state’s Birth Outcomes Initiative are paying off — elective inductions are down among both Medicaid patients and patients with private insurance.

That’s good for the babies, but it’s also good for the state budget. Healthier babies mean lower hospital bills. The state Medicaid agency pays for about half of all births in the state every year and the average cost of an admission to the neonatal intensive care nursery is more than $25,000 per baby.

An actuarial analysis paid for by the state Medicaid agency earlier this year shows that the Birth Outcomes Initiative may have saved the state government $6 million during the first quarter of the 2013 fiscal year alone.

The estimated savings was calculated by comparing what the Medicaid agency actually spent versus what it projected to spend. The department could not provide the actual amount it spent during the same three months in 2012 on infant deliveries and neonatal intensive care admissions, so a year-over-year comparison is not possible.

While early elective inductions are down, the state’s infant mortality rate remains high.

In 2012, an average 7.6 infants out of every 1,000 born died before their first birthday in South Carolina, according to data released last month by the state health department.

That’s up from 7.4 deaths per 1,000 in 2011. The infant mortality rate in South Carolina was stagnant between 2010 and 2011. It’s significantly higher than the estimated national average of 5.9 infant deaths per 1,000.

Disorders related to short gestation and low birthweight are the third leading cause of infant deaths in the state, behind congenital malformation and a category called “all other causes.”

The Birth Outcomes Initiative was founded in 2011 and it’s still too early to expect the group to make great strides improving the state’s infant mortality rate, said Ana Lòpez-De Fede, director of the Division on Policy and Research on Medicaid and Medicare at the University of South Carolina.

“I firmly believe that the policies we’re putting into place (through the Birth Outcomes Initiative) will have great impact,” Lòpez-De Fede said.

The Birth Outcomes Initiative will host its second annual symposium in Columbia on Thursday.

Reach Lauren Sausser at 937-5598.