May 7, 2012
I volunteer at Consumer Action assisting consumers by providing information and resources to help solve their consumer complaints. Many consumers are unaware that individual health insurance plans in many states do not cover maternity care. One consumer seeking assistance from Consumer Action was sold an individual health insurance policy that did not include maternity coverage even though he had specifically asked for it, and was assured by the insurance company agent that the policy included such coverage. Now the consumer’s wife is pregnant and they don’t have maternity coverage.
What can the consumer do? In California, he can complain to the department of insurance. Unfortunately, the agent’s misrepresentation about coverage was oral. Therefore, the written policy he signed will probably prevail. The moral of this anecdote is that you should always read a contract before signing it. If you do not understand the contract, have someone more knowledgeable read it for you. Or you can send a list of questions in writing to the insurance agent asking for written responses. If the agent balks, then find another insurance company.
If the couple knew in advance that the policy did not include maternity coverage, they might have been able to purchase an add-on policy or, depending on the state, a rider to cover maternity care. However, you cannot purchase a maternity rider when you are pregnant and, unfortunately, individual insurance is already very high-priced, even without the additional cost of a maternity care rider.
Presently, there are 106 individual plans in California with 26 covering comprehensive maternity coverage and seven offering less-than-comprehensive maternity coverage. There are no plans offering riders. California mandates that health maintenance organizations (HMO’s) include maternity benefits in their individual insurance plans
California’s Access for Infants and Mothers (AIM) program is a low-cost coverage program for pregnant women who are uninsured and ineligible for Medi-Cal (California’s Medicaid program). AIM is also available to women who have health insurance if their deductible or co-payment for maternity coverage is more than $500. For a fee equal to 1.5 percent of her annual household income, an AIM enrollee receives coverage for all medically necessary services (regardless of whether they are pregnancy-related) until 60 days after the pregnancy has ended.
The Pregnancy Discrimination Act of 1978, amended Title VII to specify that discrimination on the basis of pregnancy, childbirth, or related medical conditions constitutes unlawful sex discrimination. Thus, these anti-discrimination protections ensure that most employer-sponsored health insurance, or group plans, cover maternity expenses.
Under the Affordable Care Act enacted in 2010 (informally called Obamacare), starting in 2014, all new health plans sold to individuals and small businesses will be required to cover maternity and newborn care, services explicitly listed in the law as “essential health benefits” that health plans must provide. The federal government has set up a website to help explain the Affordable Care Act. However, in State of Florida v. U.S. Department of Health and Human Services, the Supreme Court will soon decide whether the Affordable Care Act is Constitutional.
Maternity coverage is essential for most families. The cost of having a baby might cost $5,000, including pre-natal and post-delivery medical charges. Then there is the enormous cost of care for premature baby delivery, breach babies, cesarean sections, and many other complications that can arise from child birth. Any time a new baby is in the neonatal intensive care section of the hospital, the medical expenses rise quickly, potentially $100,000 or more. Thus, it is important that those planning on a family carefully select an individual health policy that includes maternity coverage.
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