It costs what?! Costs of delivering a baby in the US

The only thing harder than actually delivering a baby may be figuring out what it costs. The  attempts at quantifying this cost are endless, but all total in the thousands of dollars. One of the areas of confusion is how to define cost. Do we want to know the out-of-pocket cost to families? The charges made to insurance companies? Or how much it actually costs a hospital to deliver a baby? Here I've compiled a couple studies that look at the costs of having a baby in the United States from different perspectives in the hopes of finally answering and simplifying this complicated question.

How much does it cost insured families in out-of-pocket expenses to have a baby in the US?

Let's say you are expecting your firstborn and everything is going well. You inherited the beautiful crib from your grandfather's house and checked off all the essentials at your baby shower. Now for the actual birth: how much should you budget for the big day? Truven Health Analytics took a hard look at these costs in 2013.  Their estimates included the costs incurred to the average new mother. A vaginal delivery cost insured families an average of $2,244, and a c-section cost $2,669. And that's just the cost of the actual delivery! If you count all the necessary prenatal care, the cost sky rockets to $12,520 for vaginal deliveries and $16,673 for c-sections. For Medicaid patients, prenatal care + a vaginal delivery cost $6,117 on average, and pre-natal care + a c-section cost $7,983 on average. Possibly the most shocking finding was that costs varied by more than $10,000.

How much do hospitals charge insurance companies for deliveries?

The Truven Health Analytics study also looked at how much hospitals are charging insurance companies for prenatal care and deliveries in the United States. The numbers tally up to a downpayment on a house in most cities. Hospitals charged an average of $32,093 for a vaginal delivery and $51,125 for a c-section for care of the mother and newborn. Never fear- the research showed that insurers don't actually pay the whole amount. On average, a commercial insurance will pay the hospital $18,329 for prenatal care and a vaginal delivery and $27,866 for prenatal care and a c-section. Medicaid charges were a bit lower at $29,800 and $50,373, respectively, and the actual amount paid by Medicaid is even lower: $9,131 and $13,590. As you might guess from these numbers, commercial insurance companies are paying about 100% more than Medicaid.

Finally, how much does it cost hospitals to deliver a baby?

A new study from Health Affairs by Dr. Xu and colleagues from Yale University sought to pick apart hospital charges and costs to figure out exactly how much it costs hospitals to deliver a baby. Their estimates did not include prenatal care or doctor (obstetrician and anesthesiologist) fees, so it's an underestimate of the total cost. A vaginal delivery cost hospitals an average of $4,192 and a c-section cost an average of $6,945. Even more amazing is the total cost to the US economy. With 3.8 million hospitalizations for deliveries in 2011, hospitals incur over $15.1 billion in costs. That's 6.5% of all US health costs. Again, the costs to hospitals ranged by over $10,000, from $1,189 to $11,986.

The one constant in all of these pricing schemes is variability and unpredictability. It is a herculean effort for an individual family, insurance company, or hospital to figure out the cost of a delivery. The Yale study highlights this fact when they reported the factors that predicted which hospitals would be the most expensive. Public hospitals and non-profit hospitals were actually more expensive than private hospitals and for-profit hospitals! And, there were no differences between regions. Although an average house in the Midwest is cheaper than in the Northeast, delivering a baby may or may not be! If you are trying to calculate the cost your delivery, good luck!