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What is the best health insurance plan for pregnancy?

The plan with the lowest upfront premiums that leaves you with the fewest leftover expenses is the ideal fit for women having a baby. However, there is no single right answer to this question.

First, every woman has a different prenatal and/or labor and delivery experience. In addition, your infant may enter life with a serious medical condition.

Second, your income may affect premium rates. Medicaid is free for some, while Obamacare policies offer subsidies – if you qualify.

Finally, changing your healthcare during the middle of your pregnancy is not always possible, or a very good idea. Proceed with caution.

Best Health Insurance Plans for Pregnancy

The best health insurance plan design for women during pregnancy depends on the premium rates and the type of care you might need. You are making a tricky risk management decision. You must balance the certain upfront premium costs against the possibility of backend unreimbursed medical expenses.

The back-end expenses are hard to predict because you could be perfectly healthy or run into trouble.

  • 25% of women experience high-risk pregnancy complications before birth
  • 12% of babies deliver preterm and require confinement in Neonatal Intensive Care (NICU)

Request a health insurance quote here. An agent licensed in your state may contact you to help you sort through premiums versus your exposure to unreimbursed medical expenses. You will want to know how balance billing, Obamacare subsidies, and PPO vs HMO vs HDHP work before making your choice.

Balance Billing

The optimal health insurance for your pregnancy offers an affordable premium while protecting you from large surprise medical bills associated with balance billing. Balance billing occurs when you receive care from an out-of-network provider.

Expectant women receive care most frequently from out-of-network specialists when abnormal events arise. The specialist could be a perinatologist who consults on high-risk complications before birth (25%), or a neonatologist who oversees your infant in the NICU (12%).

Out-of-network balance billing works as follows.

  • Providers can charge above the “allowed amount.” The allowed amount is a negotiated wholesale rate for services performed by in-network doctors. You are responsible for 100% of the fees above the allowed amount.
  • The Maximum Out-Of-Pocket (MOOP) amount does not protect you from these higher fees. The MOOP is the annual cost-sharing limit for in-network services. You face unlimited exposure to these additional charges.

You want to avoid this foreseeable scenario at all costs. Therefore, picking a plan with all possible providers participating in-network is vitally important. Do your research with the doctor/hospital finder tool before signing up!

Supplemental Policies

Supplemental health insurance for maternity works best when the mother has underlying coverage already in place. Supplemental in this context means extra. Additional coverage fills the holes that your primary plan does not address.

  • Short-term disability replaces a portion of income during the time you are unable to perform your job duties. Your primary plan does not feature income benefits.
  • Hospital indemnity pays an extra benefit when you check into the hospital for labor and delivery. Your primary plan may have a deductible or large copayment for hospital admissions.

These supplemental policies are most valuable when mom has complications before birth and/or when her infant requires specialized care in the Neonatal Intensive Care Unit (NICU).

Free Health Insurance

Free health insurance for pregnancy is the ideal option. After all, nothing beats coverage for prenatal care and your hospitalization for childbirth – all at no cost to you. However, only people with very low incomes or union workers enjoy this benefit.

  • Medicaid offers free coverage to some pregnant women in certain states. Each state has unique rules for who qualifies based on income. For example, the coverage may be free to women in the lowest income brackets, while those earning a bit more must pay a small amount each month.
  • Employer groups sometimes provide “free” health insurance to employees. This happens most frequently with unionized workforces. The employer pays 100% of the premium as part of the overall compensation package. You see union employees most frequently in government jobs: state, county, municipal, etc.

Obamacare Designs

Women who earn too much to get Medicaid can turn to Obamacare plans in the individual marketplace. The best Obamacare design for pregnancy hinges on three factors. The online enrollment system at healthcare.gov can help you sort through your options.

  1. Premium subsidies lower the cost of coverage. The premiums that you must pay depend on where your income falls relative to the Federal Poverty Level (FPL). Families earning more than 400% of FPL do not qualify for this help.
  2. Cost-Sharing Reductions limit your exposure to leftover expenses from deductibles, coinsurance, and copayments – but not balance billing. Families earning more than 250% of FPL do not qualify for this help.
  3. Design choices such as PPO, HMO, HSA, or HDHP affect how the insurance company calculates your cost sharing for in-network services.

Preferred Provider Organization (PPO)

Preferred provider organizations (PPO) often offer the ideal combination of affordable premiums and robust networks. A PPO is an arrangement where medical professional and facilities agree to provide services to subscribers at reduced rates.

In general, a PPO is more likely to have a wide network of participating providers that include perinatologists, neonatologists, and other maternity specialists. Therefore, your odds of surprise balance bills are much smaller. Of course, you still need to do your homework with the doctor finder tool before enrolling in a PPO.

Health Maintenance Organization (HMO)

Health maintenance organizations (HMO) work better for budget-conscious families who expect a healthy pregnancy and childbirth experience. An HMO is a network of physicians, hospitals, imaging centers, and other providers who agreed to care for members in exchange for a fixed monthly fee.

Lower monthly premiums are the primary advantage of an HMO – which is why they appeal to budget-conscious families. However, the networks are much smaller and the companies often do not honor claims from non-participating doctors. This could become a problem should mom or baby experience any complications requiring specialized care.

High Deductible Plans (HDHP or HSA)

High deductible health plans (HDHP) work best when mom and baby are both perfectly healthy and the pregnancy begins and ends in a single plan year. A Health Savings Account (HSA) is one type of a high deductible policy featuring pretax savings account for use towards unreimbursed medical expenses.

  1. Lower premiums are the primary advantage of an HDHP or HSA. When mom and baby are both healthy the expenses will still surpass the deductible. Therefore, the savings on premiums must exceed the extra exposure.
  2. The possibility of incurring the deductible three times is the disadvantage of an HDHP or HSA. This can easily happen when the pregnancy spans two plan years and is most common for due dates early in the year. For example, consider a policy with a plan year that begins each January.
    1. Prenatal care engages the 1st deductible by December
    2. Hospitalization for childbirth engages the 2nd deductible in January or later
    3. NICU confinement for infant engages the 3rd deductible in January or later

Short-Term Health

Short-term health insurance is rarely the optimal choice for pregnant women. Short-term healthcare caters to people with temporary needs and does not have to provide the ten essential benefits required by the Affordable Care Act (ACA or Obamacare). Maternity coverage is the essential benefit these policies drop most frequently.

Read the legal language very carefully before enrolling in any short-term health insurance. The odds of it covering any pregnancy-related condition are very small. However, you will at least have something to address accidental injuries and sicknesses that could affect you and your baby.

Short-term plans are sometimes the only option for women who became pregnant while uninsured. Enrollment periods limit when you can start private coverage. Therefore, women who conceive early in any year will deliver long before they can start ACA compliant coverage.

Switching Health Insurance While Pregnant

Changing health insurance while pregnant can be worthwhile if you find a plan with better network coverage for the specialists you might need. However, you should be aware of the legal limitations for making changes, and the possible pitfalls associated with the migration.

Enrollment Limitations

Legal enrollment limitations dictate whether you can change health insurance in the middle of your pregnancy. Your ability to make the switch depends on luck and other changes in life status.

The timing of your due date is the luck component.

Most expectant women will find that they can change coverage effective January 1 of the following year during the annual open enrollment period. Obamacare and most employer groups hold open enrollment in November and December.

  • Women with due dates in October, November, or December miss out
  • Women with due dates in January, February, or March win the lottery

Special enrollment periods relate to changes in life status. You can make changes within 60 days of a qualifying life event.

Carryover Features

Carryover features are a possible downside to switching health insurance while pregnant. Two critical cost-sharing features could reset and hurt your finances if you make the change during the middle of the plan year for either policy.

  • You could incur a second deductible. Prenatal care could consume the deductible on the 1st policy and childbirth would exceed the 2nd.
  • You could expand your annual maximum out-of-pocket (MOOP). Once again, prenatal care expenses could consume a big portion of your yearly limit on policy one. Then, childbirth could do the same for policy two.

Ask the new insurance company if they will prorate the deductible and/or yearly MOOP to minimize the added exposure. This comes into play when changing in the middle of the plan year of the new policy. You might experience this when enrolling as a new employee at a group, or when opting into your husband’s plan at his employer.

Switch to Husband

Switching to your husband’s health insurance during pregnancy is not automatically the ideal move. Do your homework to compare the networks, premiums, deductibles, etc. before making a change.

However, converting to your husband’s plan does offer timing flexibility.

  • Newlywed women can change to their husband’s insurance within 60 days of saying “I do.” Getting married is a qualifying life event. This means that you are eligible for a special enrollment period.
  • Many employer groups hold their annual enrollment outside of the typical November and December period. For example, a June enrollment at your husband’s employer could be more convenient.

Sources:

  1. Premiums Subsidies
  2. Cost-Sharing Reductions