Compass President Adam Johnson and Adam Wolfberg, MD, MPH, Ovia Health’s Chief Medical Office, and Lindsay Klipping, Ovia Health’s Regional Manager discussed maternity costs and what employers need to know to lower their costs in the February 2018 Compass Navigating Healthcare Webinar.
Compass Professional Health Services and Ovia Health partnered because they’re both committed to improving care, lowering healthcare costs and creating great healthcare experiences. Ovia Health is a women’s health and technology company whose maternity and family benefit solution improves outcomes through daily personalized engagement, proactively identifying potential healthcare and supporting a successful return to work.
What’s Causing the Rise in Maternity Costs?
According to Compass claims data, the average cost of delivery has increased $2,000, or 15 percent, in the last five years based on an analysis of 126,000 deliveries across the U.S. According to Ovia Health, there are several reasons for this increase:
- From 1970 to 2013, the average age for starting a family has jumped from 21 to 26. This delay in having children has increased the risks and complications associated with childbirth.
- Obesity continues to rise, creating infertility problems, gestational diabetes and preeclampsia.
- The combination of the increased age of conception and the decreased health of the population has increased dependence on infertility treatments, which has increased the chance of multiple births. It’s not unusual for the maternity cost of multiples to be more than 10x the cost of a healthy single birth, not to mention the long-term ramifications for both the mother and babies.
- The C-section rate in the U.S. has increased 60 percent from 1996 to 2009. And on average, C-sections cost more than twice the cost of a healthy vaginal delivery.
How Women Select a Maternity Care Provider
You would think women would select their healthcare provider after carefully evaluating C-section rates and delivery costs. However, this isn’t the case. Most women select their obstetrician based on recommendations from their friends.
The same holds true for selecting a hospital. Women select the hospital where they deliver based on a facility’s emotion-driven marketing or where their OB/GYN is affiliated. They’re neither looking at cost and quality data – nor know how to get this information.
In addition, some women may view higher C-section rates as a sign of a facility’s experience or quality. Unfortunately, the opposite is true. And the decision to select a hospital-based upon C-section rates significantly impacts their chances of having a C-section.
Women need help finding the right cost and quality information so they can make smarter healthcare decisions.
What Employees Can Do to Reduce Maternity Costs
It’s important for women to understand their options and the questions they should ask their doctor so they can make informed decisions.
According to data from the Centers for Disease Control and Prevention (CDC), there are certain regions of the country that have higher C-section rates. There is no reason that a woman in Connecticut or New Jersey should have a higher C-section rate than someone in Utah or Colorado. Yet in the Deep South, C-section rates are among the highest and they tend to be the lowest in the Mountain States.
In addition, the C-section rates and the facility costs can vary widely, even within a given market. Compass uses data to identify the doctors who:
- Are less likely to perform C-sections
- Have lower complication rates
- Refer patients to top-notch doctors for complicated pregnancies
Women should look for an obstetrician who is highly-rated, has a low C-section rate and is a reasonably priced. If women select an OB/GYN that tends to avoid C-sections, this can lower costs by 50 percent.
Delivery Costs Vary by Region and Hospital
Labor and delivery costs vary across the U.S. Compass research shows there are markets where the facility cost to deliver a baby is twice as high as others. There are some big cities, such as San Francisco and Boston, where the market average for labor and delivery (physician and facility fee) is between $15,000 to $16,000. And there are other markets like Dallas and Kansas City which have much lower labor and delivery fees, between $8,000 to $9,000.
While there are tremendous cost differences among major markets around the U.S., most markets also have shoppable opportunities, where women can save money, depending on where they choose to deliver. The following chart, based on Compass claims data, shows how widely delivery prices can vary within individual markets.
The green bars in the graph show markets where prices can vary $5,000 or more within market, while the blue bars identify markets where prices can vary between $1,000 and $5,000. Most patients have no idea they live in one of these places.
In general, women should pick a great hospital by understanding quality, cost and procedural differences among facilities. The hospital should have a uniformly high-quality group of obstetrician-gynecologists, and if midwives are also available, they should be AMCB-certified.
What Top Employers Are Doing to Reduce Maternity Costs
There are things employers can do to provide employees with opportunities to access the right information so they can make smarter healthcare decisions that improve maternity care and lower costs.
By engaging with women early in their maternity care experience, employers can create an opportunity for early identification and intervention, which can help lower and possibly avoid serious medical complications later in pregnancy. So, what does this look like in practice? Here are two examples:
Ovia Health Client: News Corp.
News Corp is a global diversified media and information services company with 50,000 employees, worldwide. The company’s maternity programs weren’t working: Costs were increasing, C-section rates were high and the number of preterm deliveries were increasing each year.
The company implemented Ovia Health and within the first year, 43 percent of its pregnant employees were enrolled in Ovia Health and 86 percent of them were enrolled within their first trimester. In addition, 70 percent of its participants enrolled in preterm delivery clinical modules, and subsequently, News Corp’s preterm birth rate stood at 7 percent vs. the national average of 10 percent.
News Corp also educated its employees about how to make informed decisions around unnecessary C-sections and seek assistance to cope with postpartum depression and postpartum adjustment.
Compass Client: A Major Transportation Company
Compass provides healthcare navigation support to a transportation company with more 10,000 employees nationwide. Because these employees are on the road a lot, they’re often separated from their spouses for significant periods of time, creating a challenging environment for them to make stressful maternity decisions.
Compass helped employees understand their maternity care and pick the right health plan prior to getting pregnant or having a baby. In addition, Compass helped employees understand their benefits, gave them recommendations for doctors and facilities and recommended pediatricians for after the baby was born.
Compass helped 64 women at this company make decisions about their pregnancies, saving $272,000 in claim costs – recouping nearly half of the company’s annual fees JUST from maternity care decision support.
In addition, Compass saved the employer and employee almost $4,000 per person. These are employees, many of whom have health plans with higher deductibles, so when they save money, their employer saves money as well.
To learn more about healthcare navigation, please visit WhyHealthcareNavigation.com.
- Webinar – Maternity Costs Are On the Rise: What Employers Need to Know and What They Can Do
- Podcast – Maternity Costs Are On the Rise: What Employers Need to Know and What They Can Do