Discover how to manage the financial impact of high-cost pregnancies. Explore supplemental coverage options, such as hospital indemnity insurance, and discover tips tailored for employers.
Picture this: Your employee’s family just welcomed a new baby into the world. Amid the joy and sleepless nights, the bills start arriving – for your employee and your health plan. Hospital stays, follow-up visits, maybe even NICU charges and newborn surgeries. The company’s health plan is facing a $476,000 medical claim. Suddenly, the cost of bringing life into the world feels overwhelming.
High-cost pregnancies are more common than many expect. Understanding the financial impact and how to protect your business and employees is more important than ever.
The average total cost of pregnancy, childbirth, and postpartum care for women with large employer health plans is $18,865, with $2,854 paid out-of-pocket, according to the Peterson-KFF Health System Tracker.
These numbers can vary significantly depending on the type of delivery:
Newborn/Infant Care ranked number five among the top 20 high-cost claim conditions in 2024, with an average cost of $476,200 per claim, the highest of any condition over the past four years. Even more striking, Congenital Anomaly (birth defects) ranked number six and had the highest single claim of the year at $12.7 million according to SunLife’s 2025 high-cost claims and injectable drug trends report.
Long hospital stays, complex surgeries, and comorbidities (two medical conditions happening simultaneously) are common drivers of these costs. And while these events may be rare, they can happen at any time.
Beyond the delivery room, employers must also consider the broader impact high-cost pregnancies can have on their workforce. When an employee or their family member experiences a complicated birth, it’s not just about medical bills; it’s about their well-being.
Postpartum recovery, including mental health challenges, can affect an employee’s emotional and physical readiness. Follow-up appointments and ongoing care for both mother and child add stress and time away from work. As employers, recognizing these challenges and offering supportive benefits can make a meaningful difference in employee morale, retention, and overall workplace productivity.
When it comes to managing high-cost pregnancies, your plan structure plays a critical role, particularly the funding model of the plan.
Both fully insured and self-funded plans typically cover high-cost events like NICU stays or congenital anomalies. However, the financial impact differs:
Hospital indemnity insurance is a supplemental benefit designed to provide financial support when an employee is admitted to the hospital. It pays a fixed cash amount directly to the employee, not the healthcare provider, giving them the flexibility to use the funds as needed. Whether it’s covering deductibles, copays, childcare, transportation, or lost income during recovery, this benefit can help ease financial stress.
For expecting parents, hospital indemnity insurance can be particularly valuable. If a mother or newborn requires an extended hospital stay, such as time in the NICU, this coverage can significantly reduce the financial burden. For instance, if the policy provides $250 per day and the newborn stays in the NICU for 10 days, the family would receive $2,500 in cash benefits. This financial relief can make a meaningful difference during an emotionally and financially challenging time.
By offering this benefit, employers demonstrate a commitment to their employees’ well-being while helping to mitigate the financial strain associated with high-cost pregnancies.
But hospital indemnity insurance isn’t just for high-risk pregnancies. It’s a smart option for:
In short, hospital indemnity insurance offers peace of mind and financial stability when it’s needed most.
High-cost pregnancies are unpredictable, but your response doesn’t have to be. Before finalizing your coverage, ask your broker:
Now is the perfect time to review your insurance. Don’t wait for the bills to arrive in your employee’s mailbox. Take proactive steps to explore options and ensure they’re financially prepared for one of life’s most significant milestones.
At The Miller Group, we specialize in helping employers design benefit programs that strike the right balance between cost control and company culture. Whether you’re fully insured, self-funded, or somewhere in between, we’ll guide you through evaluating your options to create a plan that fits your needs.
