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DoD to Begin Charging for All Newborn Care

By Douglas J. Gillert
American Forces Press Service

WASHINGTON, Aug. 28, 1996 – Starting Oct. 1, parents will have to pay for newborn care at DoD hospitals from the time of birth whether or not they carry health insurance.

DoD currently charges the standard family member rate for the mother and nothing for the baby, provided both are DoD-eligible beneficiaries and go home together. The same rate is charged for DoD-eligible babies requiring hospitalization after the mother is discharged.

If the family has health insurance, DoD currently bills the insurer to recover full costs from the time of birth. Beginning Oct. 1, however, DoD also will bill parents without health insurance for all newborn care from the time of birth.

In most cases, officials said, they don't see the policy having a major financial impact. Medical treatment facilities will charge just $9.90 a day for babies eligible for DoD health care, the same it charges new mothers.

The charges will be significantly higher, however, for newborns not normally eligible for care -- newborns of dependent daughters, for example. They will be billed for all costs the treatment facility incurs in delivering the baby, officials said. For normal deliveries of healthy babies, the charges will total $600 to $800.

In fiscal 1995, newborn care cost DoD $140 million. The new policy will generate some additional revenue, but officials said the real reason for the policy is to comply with legal requirements "to recover reasonable costs of providing care."

"This is not a cost-cutting initiative," said Dr. (Air Force Maj. Gen.) George K. Anderson, deputy assistant secretary of defense for health services operations and readiness. "But we have a legal obligation to charge for services we render at taxpayers' expense and particularly for those services beyond the health care benefit.

"We're concerned about causing financial hardship for anybody and don't think that will typically be the case," Anderson added. He noted that higher costs don't usually occur for well babies, and health insurers typically cover the costs of extended care. "We bill only to recover our costs, not to make a profit," he said.

Anderson said the department has been open about policies affecting payment for medical services, even posting information about the new policy newborn billing on the Internet (http://www.ha.osd.mil/hsf/newb41.html).

Medical treatment facility collection offices assist all patients with their bills, the general added, including billing insurers directly. Full payment is due within 60 days of discharge, he said.

Patients who can't afford to pay their medical bill can request relief under their service branch's secretarial designee program. The program allows the service to absorb all or a portion of costs the patient can't afford, officials explained.

"In determining what to charge for health care services, we always consider what's right for the system and what's right for the patients," Anderson said. "Under today's budget constraints, we must pay very close attention to every health care dollar we spend, but we never have and never will turn away a patient who needs our help."

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