Colorado Maternity Insurance Primer

March 12th, 2009 – They say that “timing is everything” and when it comes to maternity insurance coverage that is certainly true. People that get their health insurance through an employer often take maternity coverage for granted.

However, in the individual health insurance market consumers quickly learn that quality maternity benefits are the exception and not the rule.  In Colorado, maternity became a mandatory benefit for new individual health insurance plans on January 1st, 2011, but some older policies are not grandfathering that benefit.

Many woman mistakenly assume that their individual health insurance plan includes maternity coverage, but if they take a look at an older individual policy they may see that their coverage is limited to the state mandated coverage for complications related to pregnancy.   That means that normal deliveries and even planned c-sections will typically notbe covered at all.

Fortunately, on January 1st Colorado changed the law for maternity benefits so now you have a choice of several carriers with good maternity benefits plans with good coverage for both pre-natal and delivery expenses.  However, even these maternity plans require some planning and foresight, as you can not be pregant at the time of application or before the policy’s effective date.

What does it cost to have a baby in Colorado?  A study from the Colorado Health and Hospital Association shows the average delivery costs for vaginal and c-section deliveries at hospitals across Colorado.  See pages 284-300 of the report for details.  Statewide, the moderate cost was $8,019 for a vaginal delivery and $15,530 for a c-section.  Extreme costs were $25,545 for vaginal deliveries and $47,905 for a c-section.  Certainly, costs have gone up since this report was published in 2006.

The good news is that with proper planning there are cost effective maternity plans available to individuals. They can be affordable and provide quality protection with good PPO network options.  But timing is everything and this is an area where going without maternity coverage can be a very costly mistake.

But what if I’m already pregnant?   None of Colorado’s individual carriers will approve a husband or wife if the wife is already pregnant.  Why would this be since most individual plans don’t cover normal maternity anyways?  Because Colorado state law requires insurers pay for complications related to child birth and that the insurer put the baby onto either parent’s policy within 30 days of the child’s birth on a guarantee issue basis. If the baby is born premature that could result in costly claims, so the individual insurance companies will decline applications, even though in many cases the pregnancy would not be covered!

If a person is pregnant and their household income is low enough, the could possibly qualify for public programs like CHP+ or Medicaid.   If someone is already pregnant and are either uninsured or insured with a plan without maternity benefits, there are also maternity discount plans that can save you up to 40 to 60% off of maternity related expenses.  However, these discount plans are not to be confused with insurance and you may be able to negotiate discounts directly with the provider for pre-natal care and delivery costs.   But, even if you were able to get a 40% discount  (not unreasonable) 60% of $30,000 for a hospital stay would still leave you with a whopping $18,000 bill.  Once again, it pays to plan ahead.

Please be sure to share this article with a friend, as it may end up saving her thousands and thousands of dollars.  Questions or comments are welcome below.