Parity Pay equals Cost Savings and Access

*Description of revenue loss when birth centers take Medicaid

*Description of Medicaid expenditure for low risk birth in Texas per 100/births based on parity payments.

Cost savings to payers can be significant when considering the differences in costs associated with childbirth between birth centers and hospitals, especially if Payers covers childbirth expenses. Women who received prenatal care in Strong Start Birth Centers had better birth outcomes and lower costs relative to similar Medicaid beneficiaries not enrolled in Strong Start. In particular, rates of preterm birth, low birthweight, and cesarean section were lower among Birth Center participants, and costs were more than $2,000 lower per mother-infant pair during birth and the following year.

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Reduced Medical Procedure Costs:

  • Birth centers typically have lower rates of medical interventions, including cesarean sections, which are costly procedures. Payers could save on expenses related to surgical equipment, operating room fees, anesthesia, and postoperative care.

Reduced Complications and Interventions:

  • Birth centers promote natural childbirth with minimal medical interventions, leading to lower rates of complications. Payers could save on expenses associated with treating complications and providing additional medical interventions.

Improved Health Outcomes:

  • Birth centers focus on holistic, patient-centered care, which can lead to improved health outcomes for mothers and babies. This could result in long-term cost savings for Payers by reducing the need for future medical interventions and healthcare services related to childbirth complications.

Lower rates or preterm birth and NICU admission

  • Research has shown that birth centers often have lower rates of preterm births compared to hospitals. Preterm births can result in significant healthcare costs, including neonatal intensive care unit (NICU) stays and long-term health complications for the baby. By choosing birth centers for childbirth, Payers can potentially reduce the incidence of preterm births, leading to substantial cost savings associated with NICU care, hospital readmissions, and ongoing medical care for preterm infants.