After his second daughter was born, Kao-Ping Chua, MD, PhD, was hit with a big surprise — a medical bill for $5,000.

Chua, a pediatrician and health services researcher at the University of Michigan in Ann Arbor, switched to a high-deductible health plan right before his second daughter was born. The premium was so much less expensive than in other insurance plans, so he said he figured that even if he spent a lot of money reaching the deductible, he would still pay less overall.

“And yet, when our second daughter was born, we did end up with a $5,000 bill,” Chua told MedPage Today. As a health services researcher, Chua was mentally prepared for the possibility of a high medical bill. But in reality, encountering this expense left Chua and his family with an unexpected hardship.

“Even when you’re very good at this, even when you study this for a living, the numbers can still be shocking,” Chua said.

Chua said the experience inspired him to research out-of-pocket costs for families with private insurance after childbirth, and he observed that his incident was not isolated. Between 2016 and 2019, around one in six U.S. families paid more than $5,000 out-of-pocket for childbirth expenses, his group found.

Costs were even higher for births that required admission to the neonatal ICU (NICU). One in 11 of those families paid more than $10,000 for the birth of their baby, the researchers wrote in Pediatrics.

While Chua said he expected to see high out-of-pocket childbirth expenses in this study, the cost for babies admitted to the NICU gave him pause, as oftentimes birth complications may be unexpected.

“I think one of the really important things to remember about those families is that they are already stressed out,” Chua said. “When you add on the bills to the shock, it just seems inhumane.”

Gerard Anderson, PhD, a professor of health policy and management at the Johns Hopkins Bloomberg School of Public Health in Baltimore, said that the high out-of-pocket costs documented in this research could be a contributor to low birth rates in the U.S.

“It’s a serious deterrent for young families to have a second and a third child,” Anderson told MedPage Today. He added that $2,000 — let alone $10,000 — is a serious cost for young parents in their 20s or 30s, especially when factoring in costs of baby clothes, cribs, strollers, and other necessities.

“You have a lot of expenses with a young child, and $2,000 puts you in a deep hole,” Anderson said.

Chua and colleagues analyzed commercial claims data from more than 12 million, annual privately insured individuals in the U.S. They included births to females between age 12 and 55 years, from 2016 to 2019. For each family, the group calculated the amount of out-of-pocket spending — the sum of deductibles, coinsurance, and copayments — for delivery and newborn hospitalizations.

The researchers included nearly 400,000 deliveries in their analysis. About 34% of births were delivered via C-section, and 6% required the NICU. Approximately 29% of deliveries were covered by a high-deductible health plan, such as those with a health reimbursement arrangement or a health savings account.

Among all of the births included in the study, the mean out-of-pocket expense was $2,281 for delivery hospitalization and $788 for newborn hospitalization. In total, the average out-of-pocket cost for childbirth was $3,068, composed of deductibles ($1,292) , coinsurance ($1,711), and copayments ($66). Around 95% of all births covered by private insurance required some out-of-pocket payment.

The mean out-of-pocket costs for a C-section birth and NICU admission was $3,389, and $4,969, respectively.

Chua and colleagues acknowledged that because the details of all health plans included in the study were not available, generalizability of these results to all privately insured Americans is unclear, and is thus a limitation to their work.

In order to prepare patients for the possibility of high expenses, clinicians should counsel them on their benefits and the possibility of high bills, Chua said. However, he would like to see insurers improve their coverage for a common procedure such as childbirth.

“There are lots of people every year that are going to face these large costs,” Chua said. “Showing these costs, in my mind, is generating momentum for fundamental change.”

Last Updated June 16, 2021