Preparing Your Health Insurance Plan for Motherhood

It’s no secret that having a baby can be expensive. In fact, according to data from Policy Scout, the costs can range from almost $11,000 up to $30,000.[1]

Health insurance can provide a necessary buffer against those costs. But before you can count on your policy, you have to know what your plan currently covers, and what your options are if you need more coverage.

“Be vigilant about knowing what you have before you sign up [for a health insurance plan],” says Danita Harris, a Chartered Advisor of Philanthropy (CAP) based in New York City. “It could lock you in for a whole year.”

If you’re expecting, or you’re planning to have a baby in the future, here’s what you should know about your health insurance plan.

Marketplace health insurance plans, as well as any other qualified health plans and Medicaid plans, are required to cover pregnancy and childbirth (including both maternity care and newborn care) since they’re considered essential health benefits.[2] However, the timing of your pregnancy can be a really important factor. That’s because of open enrollment—the time when you’re able to choose a new health insurance plan. Open enrollment starts on November 1st, 2022 for 2023.[3]

If you’re currently uninsured and pregnant, or you missed open enrollment for this year and want to change your health insurance plan, you should be aware that pregnancy doesn’t count as a qualified event that would trigger a special enrollment period. However, giving birth does.[2] So you’d be able to get coverage then if you expect to give birth before November, as long as it’s within 30 days of giving birth or adoption. And the coverage would be retroactive to the date of birth or adoption.[4]

For reference, here are some of the events that could also trigger a special enrollment period:

• Getting married

• Getting divorced

• Moving

• Losing your health insurance

• Becoming a U.S. citizen

• Leaving incarceration

If you’ve experienced any of those events, you’d be able to change your health coverage as long as it’s within the last 60 days.[5]

Tip

You may qualify for free or low-cost coverage through Medicaid or the Children’s Health Insurance Program (CHIP). You can apply for either at any time of the year via the Marketplace or your state’s Medicaid agency.[6-7]

What do health insurance plans typically cover for pregnant people and their children?

It depends on your coverage. If you have the option to get health insurance from your employer and there are 15 or more employees at the company, federal law requires that your plan cover your pregnancy-related medical bills—just like Marketplace plans.[10] In that case, you’d want to look at the various other coverages (like medications and doctors) and costs (like deductibles and premiums) to see which would be the best option for you.

But if you’re employed by a smaller organization, things may be more difficult.

“The smaller the company, the more expensive your plan becomes,” says Harris. She advises also looking at community health care options if your employer health insurance doesn’t offer affordable care. If you don’t have a provider near your neighborhood, consult the locations of organizations like Community Health Systems.

The first step is to look at your existing health insurance policy. That means noting your deductible, copays and premium as well as coinsurance. That way, you can estimate how much you might pay.

Next, understand what counts as out-of-pocket expenses, and what the limit is on those expenses. A call to your insurer can help clarify these points. But your doctor will have insight into the kinds of expenses you might encounter, depending on your circumstances.

“It’s just [about] having that flexibility without putting that burden back on an already worried pregnant person,” says Harris. “You already have all these other things to worry about.”

In general, here are some of the coverages you should ask about[11]:

• Does your health care provider and birth facility accept your health plan?

• What pregnancy-related things (like breast pumps or doula care) are covered?

• If your baby needs to stay in the hospital for an extended period, will they be covered?

• Can they provide a list of in-network doctors?

• How long of a hospital stay is covered post-delivery?

Tip

You’ll want to stick with in-network coverage to save the most money. But it’s also important to consider who you want to work with during your pregnancy. If they’re considered out-of-network, you may want to look into other insurance plans.

Once you understand what to expect, you can start thinking ahead about logistics. For example, your insurance may require you to fill out specific paperwork or provide things like a birth certificate and Social Security number within a certain amount of time.

“Every health insurance plan is different, so it’s important to have the conversation beforehand to find out best practices, and you want to knock out whatever you can before the baby comes,” says Andre Jean-Pierre, a financial planner and founder of Aces Advisors. He also notes that his insurance plan required different documentation than his wife’s when they welcomed their first child.

If you have a high-deductible health plan, consider opening a health savings account (HSA). These accounts allow you to save for future health care costs, like deductibles, copayments and coinsurance while reducing your taxable income. Plus, the money is tax-free as long as it’s used for qualified expenses, and it can earn tax-free interest.

You can contribute up to $3,650 (self-only coverage) or up to $7,300 (family coverage) per year. And any unused savings roll over from year to year.[13]

“I’m a believer in contributing to an HSA anyway because planning for the unexpected helps with risk [and alleviates] a lot of issues. Even with the best coverage, there always seems to be a couple of ancillary items to cover,” says Jean-Pierre. “So, it definitely helps alleviate a lot of the expenses that come along with bringing a child into the world.”