$10,000: What New Parents Might Pay for Childbirth, Even With Insurance
Having a baby is expensive. The cost of diapers, a crib, a car seat and all the other infant necessities can really add up, and now a new study shows that having a child comes with its own hefty hospital price tag for many U.S. families.
About one in six families in the Michigan Medicine study spent more than $5,000 to have a baby. For privately insured families whose babies required time in a neonatal intensive care unit (NICU), that bill could top $10,000, the findings showed.
Some insured families can still find themselves shouldering an astoundingly high financial burden for childbirth-related costs, said lead author Dr. Kao-Ping Chua. He's a pediatrician and researcher at University of Michigan Health C.S. Mott Children's Hospital and the Susan B. Meister Child Health Evaluation and Research Center, in Ann Arbor.
Chua wasn't surprised by the findings because his family had received their own $5,000 out-of-pocket bill after the arrival of their second child.
"Unfortunately, a lot of people end up not being able to pay these bills," Chua said. "That's why medical debt is the number one leading cause of bankruptcy in the U.S."
For the new study, the researchers analyzed data from 12 million people across the United States who were privately insured, finding over 398,000 maternal deliveries that were linked to at least one newborn hospitalization covered by the same plan.
Between 2016 and 2019, families who were privately insured paid an average of $3,068 in out-of-pocket costs for maternal and newborn hospitalizations, the investigators found. When a cesarean-section birth was involved, that average bill was $3,389.
"The whole point of charging people for health care is to decrease the use of unnecessary care, but nobody would ever say a NICU hospitalization is some sort of discretionary service that people just choose to use," Chua said. "Nobody wants their baby in the NICU."
About 30% of the time, deliveries and newborn hospitalizations were covered by high-deductible health plans, such as a health reimbursement arrangement or a health savings account, according to the report. These out-of-pocket costs were typically for deductibles and co-insurance.
Adding such a high bill on top of the already high costs of bringing a baby home could devastate some families, Chua said.
The costs are so high because of how the benefit structure is designed. In a plan that uses a deductible/co-insurance structure, the insured must pay the deductible first and then pay a portion of the additional costs after that is met, Chua said.
"Hospitalizations in general are quite costly for mom and for baby," Chua said.
The findings were published June 17 in the journal Pediatrics.
Alina Salganicoff is senior vice president and director of Women's Health Policy for the Kaiser Family Foundation. Commenting on the study, she said, "It validates other research that has shown that it's very expensive for a lot of women to have a baby. For women with low incomes, Medicaid provides important protections from cost-sharing, but for many women with private insurance they are faced with significant costs related to deductibles, co-pays and co-insurance."
An increasing number of people have high-deductible health plans, Salganicoff noted. The draw is that the monthly premiums are lower.
"A lot of pregnancies are unplanned. It's hard to save up this money, and three in 10 women who have private insurance are low-income. That is incomes below 200% of the poverty level," she explained. "Saving up $1,000, $2,000, $3,000, $4,000 … it's not a possibility for these families."
Childbirth is the most common reason for hospitalization in the United States, the study authors pointed out.
Previous studies considering the burden of childbirth costs have focused on maternal care. This study combines the costs of maternal and newborn care.
The researchers suggested that clinicians could help their patients understand the high costs prior to delivery and before they get the bill, and they also suggested a future policy solution that insurers could waive cost-sharing for these hospitalizations, consistent with other high-resource countries.
Options for those looking to limit expenses now include checking that all providers and the hospital are "in-network" for the insurance plan. Some patients may also be able to work out a payment plan with the hospital after delivery.
It's also possible that an expectant mother may not realize she is eligible for Medicaid, which would cover the costs. Medicaid covers 72.2 million people, including low-income adults, children, pregnant women, elderly adults and people with disabilities.
In many states, Medicaid eligibility exceeds 200% or 300% of the federal poverty level, Salganicoff said. Expectant mothers can check Medicaid eligibility in their states to see if they're eligible.
"It's just really important for people to know that Medicaid does exist," Salganicoff said.
The Kaiser Family Foundation offers a webpage to check Medicaid eligibility. The U.S. Centers for Disease Control and Prevention offers more on pregnancy.
SOURCES: Kao-Ping Chua, MD, PhD, pediatrician, University of Michigan Health C.S. Mott Children's Hospital and researcher, Susan B. Meister Child Health Evaluation and Research Center, Ann Arbor, Mich.; Alina Salganicoff, PhD, senior vice president/director, Women's Health Policy, Kaiser Family Foundation, San Francisco, Calif.; Pediatrics, June 17, 2021