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A Hospitals NICU May Not Be Covered by Your Insurance Plan

Getting ready for a new arrival in the family always involves insurance pre-planning. If the obstetrician and hospital aren’t in the health insurance network, the parents-to-be are going to find out from day one just how expensive Junior is going to be. If you go out of network (and, of course, there may be compelling reasons to do so) most health plans will pay about 60% of the cost of a child’s birth. In-network coverage tends to run about 80%.

If, however, your baby is born prematurely and needs special care in the neonatal intensive care unit the situation may be quite different — even if the unit is in an in-network hospital. Care there may not be covered in your plan because some hospitals contract out to other clinical providers to run their NICU. That company may not accept the same insurance as the larger hospital.

It’s extremely important for prospective parents to verify that all aspects of a child’s birth will be covered by their insurance policies, especially any special post-delivery care. Michelle Andrews in a story for today’s Washington Post, (“Health Insurance Plans Sometimes Don’t Cover Care Needed by Newborn Babies”), interviews the parents of a child born seven years ago in Colorado.

The parents did all their homework. They did the math and expected out-of-pocket costs to run $400 when their son Thomas was born. When the child was circumcised, however, and the bleeding would not stop, he was diagnosed with hemophilia. He spent a day in the hospital’s NICU — administered by a company on contract with the hospital — and his parents received a bill for $50,000.

What are the chances this can happen to you? High enough. Three-quarters of the children who are treated in NICU facilities are born premature. That means one in eight babies in the United States in 2009 required this special care. Medical bills and other costs related to these births reached $26.2 billion total in 2005 or $51,600 per infant. And we all know that health cost shave headed in only one direction over the past five years. Up.

Bottom line. You cannot ask enough questions before you pick a facility for the birth of your child. If you know your child will be born prematurely, which is often the case, it may even be prudent to use an off-network hospital with an in-network NICU. And even if you expect a normal, happy delivery — which is what we wish for you — ask about the NICU anyway. None of us, sadly, are powerful enough to control fate, but we may be able to blunt its blows.

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