NICU Baby Listed as “Self-Pay”: You’ve Got to Be Kidding!

Sumana Narasimhan, MD, FAAP
Rhiana Lau, MD, FAAP

Hello from the Pediatric committee of the ACPA! We are a small but mighty group who have been active in discussing the unique issues that affect the youngest patients we all care about. This month, we are writing about a unique issue that affects newborns, specifically the ill newborn who requires intensive care and spends days/weeks in hospital, receiving lifesaving care, only to be denied by the insurance company! Here is a case scenario to help illustrate this kind of situation:

JD is an 18 year-old primigravida with history of poor prenatal care. She found out she was pregnant at 20 weeks. The father is 19 years old and works at a fast-food chain. The mother has health insurance through the state Medicaid program and the father has health insurance provided by his employer. At 28 weeks, an infant baby boy was delivered at the community hospital by emergency cesarean section due to intrauterine growth retardation and fetal distress. The infant had poor Apgars and required transfer to Level 4 Neonatal Intensive Care Unit (NICU) on his first day of life. At the NICU, he had multiple problems of prematurity including respiratory distress, feeding intolerance, necrotizing enterocolitis and electrolyte imbalances, requiring multiple subspecialty consultations, central lines and at least one surgical procedure. He was discharged to mom’s care after a 3 month stay in the NICU.

A bill for $ 250,000 was denied by mom’s insurance with the reason, “baby not on insurance policy”. Baby JD is listed as “self-pay”.

The above case describes an all too familiar scenario for those of us in the pediatric world. The numerous factors that are at play in situations like these are:

1. Young age of mother
2. Infant born at one hospital and transferred to another hospital
3. Mother may not have knowledge of the insurance process and the importance of having the birth letter verifying the baby’s birth.
4. Which insurance to use: Mom’s or Dad’s?
5. Insurance may change over the course of a long NICU stay.
6. Parents of a sick newborn may be preoccupied and overwhelmed with the rollercoaster of having a critically ill newborn and learning about the care of their child, hence insurance is not ‘top priority’.

What are the consequences of not having insurance on a newborn? Insurance coverage for newborn stay has widespread implications beyond the obvious reimbursement issue for the hospital. Babies such as the one in our vignette, require multidisciplinary care after discharge, with close follow-up with multiple subspecialties, physical, occupational (speech) therapy and often leave the hospital with supplemental oxygen. Medications, feeds and specialized equipment for feeding, transportation and respiratory support are sometimes required and it is critical to have insurance coverage at time of discharge from the neonatal intensive care unit.

It is important for hospital systems to recognize and refine the processes around newborn registration and insurance coverage in order to mitigate the issue of infants having unclear insurance coverage at time of discharge. The processes in place may vary by hospital level and by region. The following summarizes some of the issues and areas of focus that hospital systems may identify as opportunities for improvement:

1. Outborn vs inborn babies – These require different processes since mom may not be readily available if the baby was transferred to or from another facility. Engaging with the parent in-person/virtually/via phone call in a timely fashion after transfer can help smooth out the process.
2. Short stay admission – The baby may be discharged well before he or she is added to the policy, which may make retro authorization complicated. This could be mitigated by timely notification to the payor once the infant is added to the insurance plan.
3. Long stay admission – For long-stay NICU babies, insurance may change over the course of the admission. Having the primary team be aware of and periodically update insurance coverage (eg. weekly), thereby designating a member of the team to be responsible for this function may be helpful (eg. NICU social worker/UM/Registration). Insurance could also be added as a ‘check off’ box during clinical rounds/discharge planning as a helpful reminder.
4. Is the baby on mom’s policy / dad’s policy? – The infant may start off on neither or on one of the policies and then be changed to the other parent’s policy. This is an area that could easily be overlooked and hence an opportunity to refine processes (see # 5 below).
5. Education of parent(s) and/or guiding the parent through the insurance process – Parents, such as the young mom in the vignette, are usually overwhelmed with all that is expected of them during the neonatal period. Providing educational materials, timelines for completion, and meeting a parent ‘where they are at’ with their understanding of insurance is essential for success. Some parents may need staff help in filling out forms, especially if there are language barriers. Thus, an individualized approach can optimize parent understanding of the complex processes surrounding insurance.
6. Pre-emptive planning – Some centers engage prenatal providers and Mother-baby units to introduce educational materials early on to help new parents add their baby to the insurance policy timely.
7. Verification of Birth letter – This is a key document that is required by insurance companies before they can add an infant to the insurance policy. This letter is issued by the hospital where the infant is born and is usually mailed to the parent. Access to the “Verification of Birth Letter” could be improved by making it part of mom’s EMR or downloadable through a patient portal (eg. MyChart), if possible.

In summary, the addition of a newborn to insurance policy is an essential step that should be simple, yet is quite complicated in the case of newborns who require prolonged hospitalization beyond the well-baby nursery. Adding one’s baby to the insurance policy is usually a routine task that is taken care of after the baby is home with the parent(s). However, parents of a sick newborn are faced with overwhelming stress that could relegate this otherwise ‘routine’ task to being overlooked, resulting in the unfortunate situation as in the vignette where an infant needing specialized care is listed as “self-pay”. This situation could be mitigated by refining processes around infant registration, increasing awareness, and educating parents about the steps required to add their infant to the appropriate insurance policy in a timely manner. This is a great opportunity for clinical, registration, and billing staff to work together as a team to improve processes that surround the littlest patients with whose care we are entrusted.