Having a baby in a hospital is an expensive endeavor. You’ll spend more putting your baby up in the nursery than you would booking her a stay in a river view suite at the Trump International in Chicago. Checking into triage to see if you are in real labor can set you back over $500. If you are one of the lucky few who have full medical coverage, you won’t think twice about requesting extra supplies or asking for an epidural. For the rest of us, our best bet is to try and anticipate any out-of-pocket costs and save up in advance.
Some people wait until the bills arrive before coming up with a plan to pay them, but this is a big mistake. Hospitals often offer a significant discount to patients who pay in full within the traditional 30-day remittance period. You can save up to 10% by paying as soon as you get the bill. For a traditional hospital birth, that could mean saving over a thousand dollars. Paying the bill with a credit card to get the discount is not a good idea unless your interest rate is under the percent of savings and you plan on paying the balance in full fairly quickly. In most cases, it’s not a good idea to use credit cards to pay medical bills. Most hospitals will set up a payment plan without interest. Why pay interest if you don’t have to?
The best way to tackle the bills is to set money aside before the birth. If you have a health savings account (HSA), this is a great way to set aside money tax free. If you have a deductible, plan on meeting that deductible for both you and the baby. Your baby will incur her own bills; don’t expect her treatments to end up on your bill and be paid by insurance after you meet your own deductible. This was one thing that really surprised me. If you have a $2,500 deductible for each family member, expect to pay at least $5000. I say “at least” because they always find something to charge outside of the maternity coverage, and most insurance plans have a separate deductible for maternity and for regular health care. Your only chances at incurring a bill less than $5000 is if you have a home birth with a certified nurse midwife.
If you are planning on staying home with your new baby and quitting your job, consider “quitting” early by putting all of your income into a savings account while you are pregnant. You will have several months to adjust to living on one income, and the money you save can be used to pay off medical bills as well as other expenses once you really leave your job.