Study Finds the Cost of Birthing Babies Skyrocketed Between 2004 and 2010

A recent study of the Marketscan Commercial and Medicaid databases noted that giving birth is one of the most expensive health care expenditures in the United States (The Cost of Having a Baby in the United States, January 1, 2013). The study measured “cost” as the amount employers, Medicaid managed care plans, Medicaid programs and others pay to hospitals, clinicians, and other service providers. The study found for women and newborns with employer-provided health insurance that the average charges for a vaginal and cesarean births were $32,093 and $51,125, respectively. For mothers and newborns with Medicaid coverage these costs are only slightly lower; vaginal birth costs were $18,329 and cesarean birth costs were $27,866. Newborns that stayed in neonatal intensive care units (NICUs) had significantly larger average payment levels compared to payments for all newborns. The study also found the average total maternal care costs for women with employer-provided insurance in 2010 varied widely between states.

The study estimated that for vaginal births, the primary insurer paid approximately 87 percent of all costs, out-of-pocket costs were 12 percent, and secondary insurers paid approximately 1 percent. These figures did not change much for cesarean births, where primary insurers paid approximately 90 percent of all costs. The study noted that Medicaid pays approximately 99 percent of all costs for vaginal births and 98 percent for cesarean births. The large percentage of payments went to facilities and maternity care providers, with the remainder to providers of anesthesiology, radiology/imaging, laboratory, and pharmacy services.

The study also found that for newborns that stayed in NICUs, insurers paid significantly larger average payment levels in comparison to payments for all newborns.

The average total payments for maternal-newborn care by commercial payers was approximately double the average Medicaid payment for both vaginal births ($18,239 vs. $9,131) and cesarean births ($27,866 vs. $13,590). From 2004 to 2010, average commercial insurer payments for all maternal care increased by 49 percent for vaginal births and 41 percent for cesarean births and the average out-of-pocket payments for all maternal care covered by commercial insurers increased almost four times for vaginal births and cesarean births.