Cost of Childbirth Growing For Those With Employer-Based Health Insurance

Flanagan family after the birth of their daughter
Caitlyn and Philip Flanagan are among the new parents who have been affected by the rising costs of childbirth in Georgia. Caitlyn Flanagan delivered their daughter at Wellstar West Georgia Medical Center in LaGrange, where the two parents both work. (Photo Courtesy/Natalie Shelton, Wellstar West Georgia Medical Center)

Even though Caitlyn and Philip Flanagan have health insurance through their employer, the WellStar West Georgia Medical Center in LaGrange, they weren’t immune from the high cost of having a baby.

When their daughter, Millie, was born in November 2018, they paid about $6,000 in out-of-pocket costs for the cesarean birth. Before that, the had paid “several thousand” dollars for her prenatal care.

“We just paid it off two months ago,” Philip Flanagan said as he scrolled through his online patient portal. The couple anticipated childbirth might be expensive when they experienced a big shift in their insurance coverage around 2016. Their $10 to $15 co-pays for a routine doctor’s visit disappeared, replaced with out-of-pocket charges that cost about $150 a visit. 

“People sometimes seem to assume that working in health care you might get a break, but that’s not the case,” said Flanagan, who has worked in information systems at WellStar for seven years. His wife has been a registered nurse there since 2016. “We’ve experienced big changes in our insurance coverage in the past several years just like everyone else.”

 Why It’s Newsworthy: Approximately 45 percent of pregnancies are unplanned, and a recent Federal Reserve Board report found that 40 percent of Americans do not typically have $400 to spend on unexpected medical expenses. 


Coleman Foss, president of WellStar West Georgia, said Affordable Care Act regulations that went into effect in 2016 or 2017 were well-intended but had “sweeping ramifications” on healthcare providers, including the health insurance coverage they offer to employees.

“Our own employees are affected financially by the rising cost of their own premiums, with high deductibles, just as our own patients are,” Foss said.

“At the end of the day, today’s insurance model is like having catastrophic coverage,” he said. “You get it only because it offers a safety net if you have a serious injury or accident.”

National Study on Childbirth Costs

Women with employer-based insurance like Caitlyn Flanagan are continuing to experience rising costs in childbirth and maternity care due to the ACA regulation changes around 2016. A study published earlier this year in the journal Health Affairs showed those same costs had already risen an average of $3,069 to $4,569 between 2008 and 2015.

Out-of-pocket spending for women who had vaginal births increased from $2,910 to $4,314 and costs for cesarean births increased from $3,364 to $5,161 for the years studied. While the out-of-pocket spending increased, the cost of maternity care remained consistent, being $29,518 in 2008 and $29,314 in 2015.

The study, conducted by researchers from the University of Michigan, aimed to determine how the implementation of the Affordable Care Act, enacted in 2010, affected out-of-pocket spending on maternity care. It explored estimates of out-of-pocket costs by women before and after the law took effect. The study included 657,061 women who were enrolled in 84,178 employer-based insurance plans who had been hospitalized for childbirth and had accumulated medical expenses associated with maternity care between 2008 and 2015.

Researchers found the jump in out-of-pocket costs to be greatly influenced by increased spending among women with insurance deductibles.

Finding Innovative Solutions

The expectation was, at least on a macro level, that things would get better, said Dustin Rector of Larry Baumwald Insurance in Athens. He was not involved in the study but said he has not seen an impact, even as non-traditional, short-term plans were introduced.

“Quite honestly, there hasn’t been a whole lot that’s changed,” he said. Though he remains optimistic about the possibility of subscription-based health care plans, which allows patients to pay membership fees monthly or annually and access benefits at certain healthcare providers.

The study emphasized the importance of having maternity coverage for the health of both the mother and the baby to prevent women from delaying necessary maternity care, which can lead to pregnancy complications. 

Dr. Andrew Leach, a physician with Women’s Healthcare Associates in Athens, said it’s not uncommon for women who can’t afford care or the costs associated with transportation to obtain care to ask for help. Local healthcare providers often point patients to social workers, who can help connect them with the local programs and clinics offering free and reduced care. 

“For people that specialize in health coverage situations, we have to practice helping patients become aware,” Leach said.

Rector added that primary care providers are beginning to work closely with patients to innovate solutions.

I’ve seen a lot of doctors offering ‘Hey, let’s just get the insurance part out of it and work on an agreement between you as the patient and me as a provider,’” he said.

Rector also said people with young children are also finding avenues on their own. “I’ve seen them just sort of pragmatically research and find lower costs, maybe even more efficient ways to either give birth or have pediatric care.”

Researchers in the University of Michigan study said that that for them, it is encouraging to see that between 2014 to 2015 the increase was relatively smaller compared to previous years, leading to the fewer differences in maternity care spending between patients of varying backgrounds, including patients who receive lower or higher incomes.

Addressing High Costs

Still, the costs are still considered to be high. A recent Federal Reserve Board report found that 40 percent of Americans do not typically have $400 to spend on unexpected medical expenses, and additionally, 45 percent of pregnancies are unplanned. 

Cost of Birth Statistics
Statistics from Out-Of-Pocket Spending For Maternity Care Among Women With Employer-Based Insurance, 2008–15, published in Health Affairs in January 2020. (Infographic/Emma Kate Shelton)

As a result of these findings, the researchers recommend that state and federal policymakers look into enacting policies that restrict cost-sharing put into place by the Affordable Care Act that has led to the increase in maternity costs.

Emma Kate Shelton is a junior majoring in journalism in the Grady College of Journalism and Mass Communication at the University of Georgia.



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