NICUs and Health Care Costs

In Texas, government officials trying to curb health care costs are questioning the increased use of Neonatal Intensive Care Units, or NICUs.

The data suggest that NICU beds may not be proliferating because of natural demand alone. Births in Texas are up nearly 18 percent since 1998, according to state health statistics. Meanwhile, the number of NICU beds in Texas hospitals has surged roughly 84 percent, to 2,510 in 2009 from 1,365 in 1998.
Some state health officials suggest there is a profit motive at play for hospitals. The average routine delivery costs Medicaid $2,500, according to state records; the average NICU stay costs $45,000.

Put me on the side of the Scrooges on this one, with a big caveat. The American way of birth is hyper-medicalized and crazily expensive. We have far too many Caesarean sections, too many inductions, too much care being delivered by doctors instead of midwives. In America, natural childbirth -- which is a lot cheaper and leads to better outcomes for healthy mothers -- has nearly disappeared except among highly educated upper middle class women and religious fanatics. I think hospitals are exploiting women's fear of childbirth to make money selling expensive services, and I think a lot of doctors make too many interventions. They do so for a lot of reasons, but fundamentally they just don't like watching something happen that is beyond their control. The urge to leap in and seize control of the process is strong, especially when they might be sued for not doing enough. I think there are a lot of reasons to move to a less medicalized model of childbirth.
But where I part company with the Texas Scrooges is over other medical costs. As I wrote a few weeks ago, the government has programs in place that are intended to reduce preterm birth (and therefore NICU use), and the Republicans are trying to cut all of them. You can't simultaneously cut money for maternal health and reduce NICU use. Healthy, educated mothers don't have many premature babies. So if the Texas authorities are serious about cutting back on this expense, they should be spending more money to educate pregnant women and give them the help they need to lead healthier lives.