OBJECTIVES: Health economic analyses have shown that providing free contraceptive cover leads to cost savings of 15—17% when considering the cost of managing unintended pregnancies and their outcomes.  The US Patient Protection and Affordable Care Act (PPACA) mandates employers to include contraceptives in their employees’ health care coverage at no out-of-pocket cost to women. This model estimates the budget impact and cost-effectiveness to the US health care system of providing this coverage to women across different employment and insurance settings. METHODS: An age-specific Markov model was developed for women aged 15–44, using data from the US Census Bureau and National Survey of Family Growth. The model explored direct medical costs associated with contraceptive coverage. The direct medical costs of unintended pregnancy (live birth, abortion, miscarriage and ectopic pregnancy) were sourced from published literature identified using Pubmed.  The model considered the impact of altered contraceptive use associated with free coverage (using data from the CHOICE study), and accounted for differences in efficacy between these modalities. RESULTS: The model showed that savings may be realised by the US health care system when contraceptives are provided free of charge to women at risk of unintended pregnancy, a strategy which remained cost-effective over a variety of sensitivity analyses.  Key drivers of savings included the tenfold increase in recourse to long-acting reversible contraceptive methods, which led to a three- and five-fold decrease in unintended pregnancies and associated medical costs, respectively. CONCLUSIONS: This model is the first to estimate the impact, to the US health care system, of the PPACA mandate for free contraception, accounting for revised contraceptive usage when coverage is provided with no out-of-pocket costs.  Findings suggest that providing contraception free of charge is cost-effective and cost-saving for the US health care system, and could be even more so were indirect and intangible costs considered.