[HealthFilter] How much does the average no complication birth cost?

September 4, 2009 10:59 AM

Had a beautiful baby girl a few months ago. Previous baby due to excellent insurance cost exactly $0. This baby, with crappy Aetna insurance close to $4k. This is after deductible, and using a doctor that was non-preferred (which we paid more for) I am still puzzled how I ended up getting charged this much. Anyway I got to thinking. Why is my out of pocket cost $4k for a birth with no complications? Why is the total cost for this birth $17 - $18k?

Some detail:
Pomosin (sp?)
Epidural
Misc pain killers
2 nights stay post birth
4 - 5 hours labor @ hospital, less than an hour for the "all hands operation"
Cord blood draw

My question - what was the total cost for YOUR kiddo's birth (or your friends)? Is this really what it costs nowadays for what is, for the most part, an incredibly routine procedure?

posted by gnash to health & fitness (39 comments total)

Malpractice insurance.
posted by dfriedman at 11:00 AM on September 4

malpractice insurance hardly accounts for huge bills. Note that with good insurance, no charges. Does that mean malapractice ignored with decent insurance?
posted by Postroad at 11:05 AM on September 4

We had a baby in March. Looks like it cost us a bit under $2k for an experience pretty much exactly the same as yours, minus the cord blood draw. We're in California and have a decent PPO plan from Blue Shield of California. If we had an HMO plan the out of pocket cost for us would have been far, far less.
posted by zsazsa at 11:06 AM on September 4

I had a similar situation with an illness a few months back. I actually got a very bad throat infection that required hospitalization. I was in the hospital for 2 days. My insurance covered everything after deductibles and co-insurance payments.

Total Bill: $19k+change
My Portion: $2000 co-payment + $2500 co-insurance

So it all boils down to shitty insurance plans, kinda sucks but that's the way it runs. I think the actually hospitalization charges for the bed and room were the vast majority of the bill. The actual medical assistance was relatively minor in comparison.

What I did do is offer to pay the entire bill that moment and they reduced the total amount due by 20%. So I walked away only paying $3,850 and change. They have a hard time getting money from most people so they always offer you a discount.
posted by Gravitus at 11:08 AM on September 4

Didn't you get bills and explanations of benefits that itemize the charges and how much your insurance is paying for it?
posted by grouse at 11:08 AM on September 4 [4 favorites has favorites]

The sum total cost of malpractice insurance in the US is about 2% of the cost of healthcare. Even given the high malpractice insurance rates for obstetricians, it doesn't come close to accounting for the high cost of labor and delivery.

When you say the total cost was $17k-18k, was that the amount the insurance company was billed or the amount that the insurance company paid? If the former, you have to understand that hospitals routinely bill outlandish amounts knowing that they will only be partially compensated. The reasons for this are complex, but it's a necessary practice in the screwed up US healthcare system.
posted by jedicus at 11:09 AM on September 4

You might find this talk about the high cost of labors interesting (pdf or audio .. circa 07).

One guess: are you in the Northeast?
posted by shownomercy at 11:12 AM on September 4

Is this really what it costs nowadays for what is, for the most part, an incredibly routine procedure?

You're also paying for the availability of equipment, staff, and supplies when something does go wrong.
posted by Jahaza at 11:14 AM on September 4 [1 favorite has favorites]

Because most people have great insurance and as there's a steady flow of people who want a beautiful birthing experience, child birth is a huge profit centre for hospitals.
posted by GuyZero at 11:17 AM on September 4

You are also paying to cover the poor, homeless, and just plain deadbeats that skip out on their bill. The hospital knows to expect a certain amount in noncollectable care every year. Those of us that can pay or have good insurance end up picking up the tab for those that don't. That is not necessarily a bad thing, but the way we do it today may not be the most efficient way to handle it.
posted by COD at 11:21 AM on September 4

Cord blood is really expensive. I remember a talk between my wife and I about whether or not to do the cord blood. I guess I talked her out of it, and without angering/saddening people, let me just say it's one of many things we wish we had done.

But beyond that, I agree with GuyZero. Child-birth is one thing most people take very seriously and will put out as much effort as possible for, financially or otherwise. The smart thing to do, for hospitals, is to take advantage of this.

It might be cheaper to have your baby assisted by dolphins, but there aren't near as many sharks in the hospital.
posted by Palerale at 11:37 AM on September 4 [2 favorites has favorites]

I think COD is right to some extent. Just the other day my friend needed to visit an urgent care center, and we called around to find the cheapest place she could go since she is uninsured. We went to an urgent care center whose standard fee for a visit is $160, but they gave a discount to those without insurance, making it $108. They have to cover that cost somehow - they aren't making that much profit. Of course, the insurance companies pass that cost on to you in higher premiums. My friend was actually kind of pissed that other people are paying for her health care, but in her current situation didn't have much choice - the next cheapest place was over twice as much.
posted by thejanna at 11:38 AM on September 4

To further clarify my comment, price and cost are two very different things. Every service has a different profit margin for a US hospital and my understanding is that childbirth is a high-margin business. To risk tautology, it's expensive because they charge you a lot of money. :)
posted by GuyZero at 11:41 AM on September 4

As a general rule, the book price of services provided in a hospital will have only the vaguest possible connection to either the hospital's actual costs for a particular service or the reimbursement they'll receive for them.

Medicare and most state Medicaid programs pay prospectively (ie, with the rate determined in advance, irrespective of the hospital's charges) for hospital care, either through a fee schedule or a set case rate for all of an inpatient stay. Larger commercial managed care plans with a lot of leverage in their markets will be able to negotiate similar arrangements, especially for inpatient stays.

This means that if a hospital needs to increase its net revenue by raising its prices, there will have to be relatively large price increase proportionate to the net revenue benefits they want to realize: depending on their market, they'd be lucky to see ten cents on the dollar. What's more, services like obstetrics that are consumed disproportionately by non-Medicare patients may see their prices raised more since there will be slightly more net benefit to a rate increase there. This again would depend on the hospital's market and payor mix - it wouldn't be true so much if most of their OB services are going to Medicaid patients.

Compound these rate increases year after year, and you end up with the astronomical prices we see today. If you were going out-of-network, then you get hit twice on your out-of-pocket: once because there's no contractually negotiated discount between your carrier and the hospital, and again because you'll bear a higher portion of that liability than you would in-network.

I'm not sure from your post whether just the doctor was out-of-network or the hospital as well, or for that matter whether the $4000 bill was for just the facility charges or included your obstetrician's professional fees as well. It would honestly be very unusual for a hospital not to participate with a national payor as large as Aetna, so I'm guessing at least the facility fees were in-network, but still $4000 is not that surprising if you have a high-deductible plan with co-insurance that kicks in after your deductible is met.
posted by strangely stunted trees at 11:44 AM on September 4 [1 favorite has favorites]

You're also partially paying for the folks with no money and no insurance whom the hospital must treat by law. Say I'm a single pregnant woman with no job and no income. I'm seven months along and suddenly go into labor. By law any hospital I stumble into once my water breaks must accept and treat me. They must also cover all the NICU charges for my premature baby. Almost every hospital is part of a larger health care chain or system, so even if your baby was born at Our Lady of Lourdes, it is part of the Mazlow-Freen Health Care System, which owns and operates hospitals in three counties, including City Receiving (where my baby spent six weeks in NICU at no charge to me). The company has to somehow make up for the free treatment they're giving at City Receiving (Medicaid only pays so much), so they pass those costs along to every other patient. Some insurance companies will pay more than others. Most will dicker back and forth with the hospital. Hospitals in turn must pay the salaries of their ever-increasing administrative/reimbursement staff to handle the mountains of paper work while staying on top of the latest rules and regulations.
posted by Oriole Adams at 11:48 AM on September 4

Another thought that occurred to me is that quite frequently some obstetrics services are not covered by health insurance, especially something like a cord blood draw that they could deny for not being medically necessary.

As grouse asked, have you received an explanation of benefits from Aetna, or a statement from the hospital, showing what services were covered and how they calculated your liability?
posted by strangely stunted trees at 11:50 AM on September 4

Some answers from Yahoo! Answers.

Cost of having a baby in parts of Canada.

According to this article, the cost of having a doctor-attended birth (including doctor fees, staff salaries, and hospital costs) in Alberta in 2006 was $4000 CAD.
posted by blue_beetle at 11:52 AM on September 4 [1 favorite has favorites]

We opted for the cord blood, but that might be all we paid for out of pocket. Our first choice doctor and the one hospital he delivers in were in our plan, though not very close (and 6 of an eventual 7 or 8 inches of snow had fallen when we were departing for the hospital).

We have Carefirst BlueChoice Open Access through an employer, which was one of the cheapest options available to us.

Also, I don't remember any charge at all for the collection of the cord blood by the delivering physician; it's the cryogenic storage company that gets all that cash in our case.

It sounds like going out of network is what made your delivery so expensive. We would have done it, too, if that's what it took maximize our confidence, but the expense comes along with it, at least as health care is now.
posted by NortonDC at 11:56 AM on September 4

There is no "regular" price.

The hospital and insurance are both trying to make money (which is why the system is so screwed in the first place).

So they go back and forth.

That's why when you look on your EOB you'll see something like

Provider Amount Allowed Amount Amount Covered
$1000 $750 $750

(or if you have not met your deductible yet, say you have a $300 deductible)

$1000 $750 $450


However, if you did NOT have insurance, you would be charged the provider amount or something higher or possibly lower, depending on what you can work out with them. As someone stated above, they got a discount for immediate payment.

Hence, there is no "regular" charge.
posted by sio42 at 11:57 AM on September 4

wow...i totally should have previewed...i hope that my "columns" make sense.
posted by sio42 at 11:58 AM on September 4

>There is no "regular" price.

Well, yes and no. The hospital will have a Charge Description Master, listing every service they provide and its "price", and this will be used to calculate the hospital's gross charges. The gross charges will not vary based on who's liable, and they can never charge anybody an amount higher than this - but almost everybody will pay a lower amount, whether it be an insurance payor with a negotiated discount, or a self-pay patient after prompt pay and charity care adjustments are applied.

The only parties that would pay full CDM rates are so rare as to be almost hypothetical though, so you do have a point: an uninsured person with a very high income who was not prepared to pay cash up front, or a non-contracted indemnity insurance plan with no deductibles or co-insurance they pass on to the patient.
posted by strangely stunted trees at 12:10 PM on September 4

This site might help. You'll have to drill down to your state.

I looked for Texas, for a vaginal birth with no complications, it gave this information:
Number of discharges in 2007: 210,923
Average length of stay: 2 days
Average charge: $7,656
Average charge per day: $3,828
Median charge: $6,915

For the hospital I specifically chose in my general area, about the payers it says:
Hospital collects an average of 34% of its charges from all payers.
Hospital collects an average of 31% of its charges from Medicare.
Hospital collects an average of 24% of its charges from Medicaid.

For health care charges that the hospital did not receive payment:
3.35% because of charity care
5.91% because of bad debt
9.43% total uncompensated care
posted by Houstonian at 12:11 PM on September 4 [1 favorite has favorites]

One thing to keep in mind with Houstonian's numbers above is that they are for hospital charges only. Generally, when you go to a hospital and have a baby, the hospital bills separately from the physician, so looking at hospital-only charges (or costs) will underestimate the actual total charges for a birth.
posted by iminurmefi at 12:27 PM on September 4

I don't know what kind of insurance you have, but this report, on Maternity Care and Consumer-Driven Health Plans, may shed some light.

Usual disclaimer: I work at KFF, but not on the policy side, and I don't write or research for them.
posted by rtha at 12:27 PM on September 4

what was the total cost for YOUR kiddo's birth

My son's birth: 26 hours of labor, c-section, a couple hours in the NICU, five day hospital stay for both of us - around $25,000. In 1997. Thank goodness we had really, really good insurance then. We didn't pay a penny, except the co-pays to the OB and our pediatrician who called on us in the hospital.

My daughter's birth: 4 hours labor, VBAC, less than 22 hours in the hospital - around $15,000 in 2000. Again, insurance covered the bulk.

If I were to have a baby today, I'd have to pay almost everything out-of-pocket. We have private health insurance now and it sucks ass. It's better than nothing, and will cover 100% of a catastrophic event, but still. Sucks.
posted by cooker girl at 12:32 PM on September 4

I can't figure it out either and your question and my confusion is one of the reasons that healthcare reform is needed in this country - to make things understandable.

Anyhow, I dont have baby costs to share but i was in the hospital for 7 days last April. They never figured out what was wrong with me after persorming several tests and drawing my blood every 2 hours. Some cocktail in my IV slowly improved my health until i could be released. The only diagnosis after the whole ordel was that i had an undefined virus. I had been admitted for having an extremely low white blood cell count after going to the emergency room at 3am after 2 weeks of flu like symptoms and not eating.

The hospital initially billed my insurance company over $41,000. Then each doctor that called on me (general hospital doctor, infectious disease doctor, hemotologist, rheumotologist) billed the insurance separately (to a tune totalling around $15,000). On top of that every lab that analyzed my blood tests (and bone marrow) billed insurance separately, totalling around $10,000. So my insurance was billed approximately $65,000 for my hospital stay. My out of pocket costs came to be around $3,500 - this is from the initial hospital bill, i have no idea if I'll receive another bill from a doctor or lab. All providers were "in network" except for one lab that had to analyze my blood to see if I had some rare baterial infection (this test is only done in a few labs across the country).

I really can't find any ryhme or reason as to how these numbers are figured out, but all i know is whatever you do, DO NOT GET SICK.
posted by WeekendJen at 1:04 PM on September 4

Excellent discussion, much appreciated.

To clarify some information that people asked:

1) I am not counting cord blood storage costs - I paid about $250 - 500 to have the cord blood drawn and packed up in a kit and sent out, nothing more.
2) Doctor was out-of-network, hospital was in-network.
3) The 17 - 18k I refer to is, as I understand it, what insurance (and I) ended up paying.

I did get explanation of benefits which after I have everything assembled will come back and post the full breakdown (may take a bit of time so if interested favorite this topic).

I was given guidance by others to question every item - which I am doing after I actually paid all of my copays (which I can get back some of if it turns out that I was overbilled).

The suggestion has merit as we (insurance and I) literally paid several hundred dollars (I think 500) for 5 painkillers.
posted by gnash at 2:05 PM on September 4

Additional NB to all:

I paid out $4k after I was assured by an Aetna rep that given the information we gave we would pay no more than $400 out of pocket.

I tripled her estimate, and well, it was still off. I suppose the lesson here is put aside a couple of grand in the pretax (or other) med savings and don't listen to your insurance rep (as far as estimates :) ).
posted by gnash at 2:07 PM on September 4

I had a c-section after 4 days in the hospital for a total of 8 days in the hospital. Minor complications but nothing serious. I think all the bills from the hospital and the doctors for me and the baby (they billed us separately!) was about $70,000. All, except for my co-pay of $100 was covered.
posted by otherwordlyglow at 2:48 PM on September 4

My anecdote: My labor progressed very fast, so fast I didn't make it to the hospital and wound up delivering on the bathroom floor with the assistance of the local fire department. The paramedics then took us to the hospital, where we stayed for two days of recovery. My son was fine, I was fine. I needed two stitches. They gave me some advils and some colace. My son got the state-mandated hearing test and the first round of vaccinations.

The ambulance company billed us twice: once for me, once for my son. $1,200 each time. (I called them up and said "hey, it was one ambulance" and they said "oh, but there were two patients in it." Insurance picked up most of it, we paid $100 each for both of us.

The hospital first sent us a bill for over $16,000. Then the insurance company kicked it back and the hospital lowered the bill to just over $5,000. (Note how this truly screws the uninsured- if we hadn't had insurance, we would have been on the hook for the full $16K without the negotiating power our insurance provider has.) And that was just for the recovery, mind you.

The fire department, of course, never sent us a bill for delivering our son.
posted by ambrosia at 2:56 PM on September 4 [1 favorite has favorites]

According to this article, the cost of having a doctor-attended birth (including doctor fees, staff salaries, and hospital costs) in Alberta in 2006 was $4000 CAD.

That's the cost to AB Health, not what parents pay. Alberta is free just as it is in the rest of Canada.
posted by ethnomethodologist at 6:17 PM on September 4

Homebirther/waterbirther here. 32 hours of labor, 4 hours of pushing (damned nuchal hand) and no drugs, no invasive procedures/tests, only the invited were welcome in my home: the cost for everything was $2,000 and I paid none of that. The after visits were completely covered. The only thing I paid for was the $5 bottle of painkillers from the drugstore.

Because most people have great insurance and as there's a steady flow of people who want a beautiful birthing experience, child birth is a huge profit centre for hospitals.
posted by GuyZero at 2:17 PM on September 4 [+] [!]


My idea of beautiful isn't hooked up to monitors with drugs, and strangers all around me in a less-than-hygienic setting. Ew.
posted by Lullen at 6:22 PM on September 4

By law any hospital I stumble into once my water breaks must accept and treat me. They must also cover all the NICU charges for my premature baby.

Is this unique to childbirth? I know plenty of uninsured people who have needed emergency care -- sure they have to treat you, but they don't treat you for free. In fact, they usually make you sign something verifying that you understand that you are responsible for payment.
posted by desuetude at 6:38 PM on September 4 [1 favorite has favorites]

desuetude, I believe you are looking for EMTALA. I can't find a cite, but I believe it started with a case in Houston, in which a homeless man died outside the emergency room of a hospital because he didn't have money, and so they wouldn't treat him.
posted by Houstonian at 7:11 PM on September 4

From this article on health care costs:

"...hospitals bill according to their price lists, but provide large discounts to major insurers. Individual consumers, of course, don’t benefit from these discounts, so they receive their bills at full list price (typically about 2.5 times the bill to an insured patient). Uninsured patients, however, pay according to how much of the bill the hospital believes they can afford (which, on average, amounts to 25 percent of the amount paid by an insured patient). Nonetheless, whatever discount a hospital gives to an uninsured patient is entirely at its discretion—and is typically negotiated only after the fact."
posted by dephlogisticated at 7:30 PM on September 4

desuetude, I believe you are looking for EMTALA.

Interesting. I mean, I know that the language says "regardless of ability to pay," but then it also says "Though patients treated under EMTALA may or may not be able to pay or have insurance or other programs pay for the associated costs, they are legally responsible for any costs incurred as a result of their care under civil law." And I know that my friends have had paper waved in their faces while in severe pain acknowledging their responsibility before treatment would be given.
posted by desuetude at 8:25 PM on September 4

So, to encapsulate dephlogisticated's excerpt: The whole thing is a 5-digit shell game.
posted by Decimask at 9:56 PM on September 4

Is this unique to childbirth? I know plenty of uninsured people who have needed emergency care -- sure they have to treat you, but they don't treat you for free. In fact, they usually make you sign something verifying that you understand that you are responsible for payment.

It may very well be. The last two hospitals I've been in (Henry Ford and St. John Macomb, both in metro Detroit; taking loved ones in for testing) actually had signs posted stating that they were obligated to take women in labor in as patients despite their ability to pay. I can't remember the exact verbiage on the posters, but they did make a point of stating something to the effect that the hospital might require proof of insurance or ability to pay when applying for treatment, unless you were about to give birth, in which case (state? federal?) law required them to treat you and your baby no matter what.
posted by Oriole Adams at 12:42 PM on September 5

My idea of beautiful isn't hooked up to monitors with drugs, and strangers all around me in a less-than-hygienic setting. Ew.

Childbirth centres in major hospitals are a LOT nicer than they typical hospital ward.

But I hear you - we had ours at home.
posted by GuyZero at 7:44 PM on September 5