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Even With Insurance, Childbirth Is An Expensive Undertaking

Childbirth hospital costs these days aren’t cheap. Some studies suggest the cost of raising a child exceeds $200,000, not including education expenses.   Most insurance companies charge women of childbearing age more for their insurance because the actuarial tables say so.  Mrs  Happy and I now have a 3 month old Zachary in our wings.  He is a cute little peanut.  His two brothers, Marty and Cooper adore him.

Forty-two days after his April 21st, 2011 delivery, we still had not received our explanation of benefits from Blue Cross Blue Shield for the midwife charge.  I had previously received a statement from them saying the charge was under review.  Perhaps they believed that delivering Zachary was not medically necessary.  I can’t explain it.

When I called to ask them why this charge had not been approved,  they said they could not give me a reason why my explanation of benefits statement had not been finalized after 42 days.  I pressed for more information, but to no avail. I was given no reason other than to say that they had a lot of claims to review.   That’s not an acceptable reason to delay a payment of a claim.

Baby-Little-Peanut-Outfit-3-Months-Old

At the end of my conversation, I indicated to the nice customer service lady that I would be filing a complaint with my state board of insurance for failure to process claims in a timely manner.  Then came silence. And a pause.  She indicated they would expedite the charge through the review process.

I got off the phone, went on line and filed a complaint with my state.  Three days later, I received a finalized explanation of benefits form from Blue Cross Blue Shield.  As part of a high deductible HSA, we prepaid our midwife for the global delivery fee and for me to get my money back from them, as we had now met our deductible for the year,  Blue Cross Blue Shield needed to stop stalling and pay the midwife.  And they did. And I got confirmation this week that my prepaid money would be coming back to me shortly.  With that mess settled,  I now have a complete list of all our Zachary’s childbirth hospital costs.

But not all hospitals stays are the same.  Here’s a little background on the services that were provided for our hospital stay.
How did the hospital admission day begin?  We had been having a wonderful day at the dog park with Marty and Cooper.  But things changed rapidly that afternoon after we left the dog park and headed to Lowe’s.  Mrs Happy was admitted to the hospital on April 20th, 2011 at 7pm (shift change) after her water broke at 37 weeks on the nose, at Lowe’s, at 4:30 pm that afternoon while we shopped for a garden tiller. Because she  had not been tested for group B strep, a standard pre delivery test, she was initiated on Pen G every 4 hours prior to delivery.  She had pre delivery routine lab drawn, but I can’t remember what it was. She also had an exam to check for amniotic fluid to confirm rupture of membranes.  It was confirmed.

After labor failed to progress over the next few hours, and because her membranes had ruptured,  she was initiated on pitocin at 3 am on April 21st, 2011.  Zachary was delivered by a midwife at 1:01 pm on April 21st, 2011 in an uncomplicated vaginal delivery without an epidural, no anesthesiologist, no radiology charges and no narcotic pain medicine. She spent just under 24 hours in the delivery room and 48 hours  in the post partum room prior to discharge before we headed home to start our life with Zach.

So, what did this uncomplicated hospital childbirth cost us and our insurance company?  Here’s a table below detailing what all the childbirth hospital costs were with and without our insurance deduction for allowable contracted charges.  Note, these charges do not include other pre delivery office charges, lab work, ultrasounds and non global fee related midwife charges, which were billed separately and listed below the table.

HOSPITAL MOM

4/20-4/23

CHARGE (NO INSURANCE) ALLOWED CHARGE (WITH INSURANCE)
Private Room after delivery
(<48 hours)
$2,970 $1841.40
Ancillaries $1,371.53 $663.97
Laboratory $321 $199.02
Delivery Room (<24 hours) $3082 $1910.84
TOTAL $7,744.53 $4,615.23
HOSPITAL BABY

(4/21-4/23)

CHARGE (NO INSURANCE) ALLOWED CHARGE (WITH INSURANCE)
Nursery $1,240 $768.80
Ancillaries $164.43 $101.95
Laboratory $422.45 $261.92
TOTAL $1,826.88 $1,132.67
MIDWIFE CHARGE (NO INSURANCE ALLOWED CHARGE (WITH INSURANCE)
Global delivery charge $2,800 $2,221.41
PEDIATRIC CARE CHARGE (NO INSURANCE) ALLOWED CHARGE (WITH INSURANCE)
4/22 Newborn care $140.00 $89.93
4/22 Circumcision $653.00 $263.10
4/23 Hospital visit $129.00 $105.69
TOTAL $922 $458.72
TOTAL HOSPITAL CHARGES $9,571.41 $5,747.90
TOTAL PROFESSIONAL CHARGES $3,722 $2,680.13
GRAND TOTAL $13,293 $8,428.03

In addition to these childbirth hospital charges, we also incurred three days of home health care biliblanket therapy hospital charges of $1,069.20, with the allowable charges insurance discount reducing this cost to $555.  This was due to treatment for  jaundice of the newborn.

In addition, other pregnancy related charges incurred  included prolonged progesterone therapy, used in light of two prior miscarriages.  Some doctors believe in progesterone therapy during pregnancy and some don’t.  Our pharmacy charge for this was $489.75.  Progesterone therapy was continued right up to the 34th week of pregnancy due to persistently low progesterone levels, the cost of these frequent lab draws of which totaled $251.59 during pregnancy.  Add in five additional unbundled office visits with  four medically necessary  ultrasounds at a post insurance allowable charge of $1,583.73 and the total cost to bring Zachary from pregnancy to birth (not including pregnancy tests, gender determination IntelliGender test, an expensive “miscarriage blood testing panel” and all the prior fertility treatments and therapies) was $12,377.30.

Little Zachary cost $12,377.30  from conception through the  first few days of life.  That is in addition to the over $12,000 a year in health insurance premiums paid.  With a health savings account with a $3,500 previously met high deductible for things like my posterior labral tear and electrical stimulation shoulder therapy, which I got this year in anticipation of deductible stacking (one of my HSA tips), Blue Cross Blue Shield has thus far paid over $8,000 of this year’s charges.

Childbirth hospital costs are expensive.   Not to mention his first 2 month visit for initial vaccinations.

*This blog post was originally published at The Happy Hospitalist*


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One Response to “Even With Insurance, Childbirth Is An Expensive Undertaking”

  1. Ben says:

    I still can’t quite wrap my head around why we employ insurance to cover normal childbirth. Insurance is generally a hedge against risk, but childbirth is not some unplanned and unforeseeable catastrophe: it’s generally planned, predictable, and desired. The outrageous costs that you site for the uninsured ($600 for a circumcision!!) is in large part the result of hospitals trying to push up the “allowable rate” paid by insurance (higher base rate, so the discounted rate can also be higher). Assuming people had to pay out of pocket for normal childbirths (complications are something one reasonably should insure against), I’m certain we’d see a major reduction in these costs as hospitals would have to complete – not only with each other but also with the array of other options that exist at lower cost (birth centers, home births, etc). One of the reasons that the US has the highest per-birth cost in the world, the highest rate of C-sections, the highest rate of OBGYN-assisted births, and relatively poor maternal and neo-natal outcomes is in large part because insurance coverage skews the market:

    - Doctor & hospital have an incentive to perform most expensive/medically convenient procedures to maximize billing
    - Patients have little to no incentive to push back, question procedures, or do research
    - Systematically, hospitals have no competitive incentives to reduce costs, as patients don’t care and costs are so opaque that even uninsured patients cannot shop around

    For the same reasons that insurance doesn’t cover most plastic surgery (but does cover reconstructive cosmetic surgery after an accident), insurance shouldn’t cover child birth except in cases of medical complications. Insurance should INSURE AGAINST RISK, not just pay for anything that’s provided by someone in a white coat.

    I would actually take it one step further and argue that most routine medical care – checkups, physicals, basic screens,etc – should probably also come off of the list of insurance-paid functions, but that’s a broader structural question that needs to be addressed and I think I’ve ranted enough :)

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