Catalyst for Payment Reform

Maternity Care Payment Reform


Maternity Care Payment Reform

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What Is Maternity Care?

Maternity care can include prenatal care, labor and delivery, and postpartum/newborn care for women and their babies. Physicians, midwives, labor and delivery nurses, and/or doulas, etc., can provide maternity care services.  From a payment perspective, an episode of maternity care could begin up to 40 weeks before birth and continue for 60 days post-discharge for the woman, and from birth through 30 days post-discharge for the baby.[1]


Why Should Employers and Other Health Care Purchasers Care About Maternity Care?

Health care purchasers spend significant amounts on maternity care especially since maternity care practices in the U.S. tend to result in excessive and unnecessary interventions and poorer outcomes for patients as compared to other developed countries.  In particular, early elective delivery (EED), including non-medically indicated induction of labor and scheduled cesarean delivery prior to 39 weeks, has a significant impact on the cost and quality of care.

  • Employers spend 7–10% of their total medical costs on maternity care.[2]
  • Average commercial intrapartum payments were $9,048 for vaginal deliveries and $12,739 for cesarean deliveries.[3]
  • Increased costs are associated with induction of labor and the “cascade of interventions” that can follow.[4]
  • In the case of EEDs, babies are more likely to need neonatal intensive care and mothers are more likely to need a cesarean delivery, among other potential complications.[5]


What Are the Latest Trends in Maternity Care?

Maternity care in the United States does not consistently reflect the evidence-base or clinical guidelines.

  • In 2014, 26% of first-time, low-risk mothers had a cesarean delivery, while professional guidelines suggest no more than 15% of such mothers should have a cesarean delivery.[6],[7]
  • In 2012, vaginal birth after cesarean (VBAC) was still underutilized. Every eligible woman should be offered a VBAC; however, the VBAC rate nationally is only 7–9%.[8]
  • Induction of labor should only be used when medically indicated; however, 42% of first-time mothers, for whom unnecessary induction increases their risk for complications, had this intervention in 2012.[9]


How Can Purchasers Apply a High-Value Strategy to Maternity Care?

Purchasers can work with their health plan or third party administrator to implement a variety of payment methods that can align incentives for providers to adhere to evidence-based practices that improve health outcomes and help to contain the costs of maternity care. 

  • Financial incentives to eliminate EEDs prior to 39-weeks of gestation, including financial rewards for high-quality care (reducing early elective induction, elective cesarean sections, etc.) and non-payment for EEDs.
  • Blended facility payment that creates a single rate for delivery, whether it is a vaginal or cesarean delivery.
  • Bundled payments for maternity care, such as a comprehensive single bundled payment for a maternity care episode.


Payment reform should be part of a multi-pronged approach to high-value maternity care, including educating consumers and providers on the evidence and best practices, working collaboratively with providers to develop indications for an EED, and participating in voluntary, quality improvement efforts with hospitals.


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[2] Summer Series 2016 Maternity Care: New Strategies for Cost Effective Care.







[9] ibid

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