Why Maternity Care Costs Are Soaring for Racial and Ethnic Groups: The Hidden Truth

Maternity Care Costs Significantly Higher for Racial and Ethnic Groups

A recent study published in JAMA Health Forum sheds light on significant racial and ethnic disparities in maternity care costs, particularly among individuals with private insurance. The study reveals that Black, Hispanic, and Asian individuals tend to pay much more out-of-pocket for maternity care than white individuals, further emphasizing the deep-rooted inequities within the healthcare system.

Disparities in Maternity Care Spending

The study finds that Black, Hispanic, and Asian individuals experience substantially higher out-of-pocket costs for maternity care compared to white individuals, even with private insurance coverage. The largest disparities were noted during pregnancy. For prenatal care services that are widely recommended, Black individuals paid on average 74% more out-of-pocket than their white counterparts, Hispanic individuals paid 51% more, and Asian individuals paid 4% more. Although these disparities diminished during delivery and postpartum care, Black and Hispanic individuals still paid a significantly higher proportion of their household income toward maternity care overall.

The study analyzed anonymized data from over 87,000 pregnancies, deliveries, and postpartum care episodes, sourced from Blue Cross Blue Shield of Massachusetts over a period of five years (2018-2022). Researchers examined both the out-of-pocket expenses in dollars and as a percentage of the region's median household income. Over a quarter (26.9%) of the pregnancies studied were from areas where the median household income was $75,000 or less, which may compound the financial burdens on families.

Study Reference: https://jamanetwork.com/journals/jama-health-forum/fullarticle/2830607

The Impact of Coinsurance on Maternity Costs

A major factor contributing to the higher costs is the structure of coinsurance in health insurance plans. Coinsurance refers to the percentage of a medical service's total cost that the patient must pay after meeting their deductible. The study found that Black and Hispanic individuals were more likely to have insurance plans with higher coinsurance rates, typically above 10%. Coinsurance often applies to hospital-based care, and for high-cost services such as childbirth, the patient may need to cover a significant portion of the cost.

For example, if the total cost of a delivery is $10,000 and the patient’s coinsurance is 10%, they would need to pay $1,000 out-of-pocket. For families with lower incomes or those living paycheck to paycheck, such costs can be financially devastating. Unfortunately, these high out-of-pocket costs disproportionately impact Black, Hispanic, and Asian individuals, creating a barrier to access to essential maternity care services.

State-Level Policy Changes and the Need for Reform

In response to these findings, several states, including Massachusetts, are considering legislation to eliminate out-of-pocket costs for maternity care, a policy change that would significantly benefit Black and Hispanic individuals who face the highest out-of-pocket expenses. According to the study's authors, such a policy shift could help alleviate some of the financial strain associated with childbirth and postpartum care, reducing disparities and improving access to care.

Moreover, this study stresses that health insurance companies, employers, and policymakers should reevaluate and restructure how maternity care coverage is designed. By rethinking insurance plan structures, specifically focusing on coinsurance rates and coverage for pregnancy-related services, health systems can reduce the financial burden on families and reduce racial and ethnic disparities in healthcare access.

The Importance of Health Equity in Maternal Healthcare

This study highlights the urgent need to address racial and ethnic disparities in healthcare. The findings are particularly concerning given the known impacts of inequitable access to maternity care on maternal and infant health outcomes. Inequities in healthcare access can result in delayed or inadequate care, leading to poorer health outcomes for mothers and babies. Addressing these disparities not only helps ensure a fairer distribution of healthcare costs but also improves maternal health outcomes, particularly among historically underserved communities.

Furthermore, high out-of-pocket costs can discourage people from seeking care in the first place or force families to forgo essential services, exacerbating health risks. A more equitable approach to healthcare costs would help prevent these outcomes, improving health outcomes for everyone, regardless of their racial or ethnic background.

The Role of Policymakers and Healthcare Providers

Policymakers, healthcare providers, and insurance companies play a crucial role in reducing healthcare disparities. Implementing policy changes that lower out-of-pocket costs for maternity care and redesigning insurance plans to ensure they are more equitable is essential. Health professionals, particularly those involved in maternity care, can advocate for these policy changes and actively work to address systemic inequalities in the healthcare system. Additionally, by increasing access to education about insurance options and financial assistance programs, healthcare providers can help patients navigate the complexities of maternity care financing.

Conclusion

The findings from this study underscore the persistent racial and ethnic disparities in healthcare costs, particularly in the context of maternity care. For Black, Hispanic, and Asian individuals, high out-of-pocket expenses for pregnancy, delivery, and postpartum care present significant barriers to care, contributing to worse health outcomes and financial hardship. Addressing these disparities through policy changes, healthcare reform, and improved insurance coverage structures will be essential to ensuring that all individuals, regardless of their racial or ethnic background, have access to affordable, high-quality maternity care. This will not only reduce financial barriers but also foster a more equitable healthcare system that better serves diverse communities.