Having a baby is one of life’s most momentous decisions, a vote of confidence in your future as a family, and a willingness to have your life change beyond recognition. Health insurance should be the last thing you have to worry about as you think about whether and when to have a child.
Unfortunately, you do have to worry about it, as far ahead of time as possible. Insurance companies know that pregnancy and delivery can be extremely expensive, and many try to avoid that expense either by refusing to cover pregnancy or by getting out of actually paying for it with fine-print clauses limiting what they will pay for. Considering that 50% of pregnancies are not planned this is particularly scary.
Without careful reading you could find yourself having to pay out of pocket for your prenatal care and delivery—even if you already have health insurance. So if you’re considering having a baby—or if you’re already pregnant and wondering how to make sure you’re covered—here are some tips to make your new bundle of joy doesn’t come with a bundle of hospital bills you can't pay.
Check Your Policy—Twice!
Does your health insurance policy specifically exclude pregnancy from coverage? A surprising number do, including most individual insurance policies. California is particularly notorious for not including pregnancy coverage in individual's policies: 805,000 Californians have insurance policies that specifically exclude maternity coverage - a number that has more than quadrupled from 192,000 in 2004, according to the California Health Benefits Review Program. One woman we know who recently moved to California found that she could only get an insurance policy that covered pregnancy for a triple the price of other policies and with a $10,000 deductible. Other cheaper policies wouldn't cover her if she became pregnant. She didn't even have a boyfriend at the time, she reasoned, but didn't want to rule out the possibility of pregnancy in the next few years as a trade-off for getting insurance.
Make sure your policy does cover pregnancy and actually provides enough coverage to get you through prenatal care, hospital stay, and any additional care, such as a caesarean section, you may need. One woman and her partner who thought they had insurance for her pregnancy missed seeing a tiny table on the back page of an addendum to their policy that capped pregnancy coverage at a laughably low $3,000, and wound up with bills for $20,000 from the hospital. You should assume a normal pregnancy will cost something like $6,000 to $10,000.
Checking your plan carefully is especially important because insurance companies do sometimes mistakenly deny claims that should be covered. Knowing exactly what your policy says will help you when you question a denied claim—which you always should if you thought you should have been covered. And in some states, insurance companies are required to cover pregnancy.
If you find that you don’t have adequate coverage for a pregnancy, get a better plan, if you can, before you get pregnant. That said, it's better to be prepared.
Think Hard Before Quitting That Job!
Employer group insurance plans usually offer the best coverage for pregnancy, so if you have insurance through your employer, it’s a good idea to hang onto it. If you decide to switch to a new job, check out the insurance issue carefully before you do, as a new employer a) may have a waiting period before you’re added to group insurance, or b) may treat the pregnancy as a “pre-existing condition” and refuse to cover it. (Health Care Reform will limit insurance companies’ ability to exclude pre-existing conditions, but not until 2014.) Finding out the details will take some finesse if you don’t want your new employer to find out you’re pregnant before you’re safely in the new job.
If you do leave your job when pregnant, or planning to become so soon, consider keeping your coverage through the COBRA program which the government requires most employers to offer for 18 months. It can be expensive to maintain, but will give you the best coverage for your pregnancy, and keep you from being buried in debt if you need additional care. More on COBRA here.
Join a Group!
OK, all this is good advice for someone with employer-provided health insurance. But what if you’re self-employed, or don’t get insurance through your job (or your husband’s)? Your best strategy is still to try and join a group insurance plan of some sort. If you’re self-employed, you may be able to get health insurance through a local Chamber of Commerce or a professional trade association. If you live in New York State, the Freelancers Union also offers group health plans. There are national groups that offer health insurance to the self-employed, but check any such group out carefully before signing up: Some health insurance customers have complained of national groups selling health insurance that wasn’t what it appeared to be.
Get Pregnancy Costs Down!
If you can’t get or can’t afford the insurance you would ideally want for your pregnancy, there are still several things you can do to reduce the costs of prenatal care and childbirth without compromising your health or your baby’s. Begin by checking out AmeriPlan. AmeriPlan is not insurance, but will reduce your medical bills by giving you access to their lower negotiated rates (such as insurance companies pay). Another option, with no upfront cost, is to use a medical negotiation service.
One way to reduce the cost of childbirth—and have a pleasanter experience at the same time—is to have your baby in a birth center rather than in a hospital. A birth center offers a more welcoming environment than a hospital, and allows for water births. It can also cut the cost of childbirth in half. However, you should only consider a birth center if you are healthy and having a normal pregnancy.