Directing federal dollars to prenatal care could result in a better long-term financial picture if it helps Americans more readily welcome children.
Directing federal dollars to prenatal care could result in a better long-term financial picture if it helps Americans more readily welcome children.
I n December 2022, Madera Community Hospital in central California closed its doors to patients. The financially distressed hospital, losing money and headed to bankruptcy, had to shut down operations. As it was the only general hospital in Madera County, residents there, including pregnant women delivering their babies, were forced to travel 45 minutes to neighboring Merced or Fresno for critical and emergency health-care services.
But a curious thing happened: After securing a $57 million state loan, the hospital announced this month that it is reopening — but without a maternity ward. Prenatal-care services for Madera Community’s 60 percent Medicaid population just lose too much money.
Similar stories are unfolding in rural communities across the country. Since 2010, 151 rural hospitals have either fully or partially closed. Increasing numbers of Medicaid beneficiaries and low Medicaid reimbursements strain rural health systems financially, leading to less access to care. That contributes to maternal mortality and poor OB/GYN care among lower-income and minority women, with growing abortion numbers at the center of the crisis. If conservatives want to get serious about Vice President Vance’s call to regain the American people’s trust on the abortion issue and help Americans be able to welcome babies, we must address Medicaid.
California’s state Medicaid program, Medi-Cal, is emblematic of the national problem. Increases in the number of Medi-Cal beneficiaries, along with year-over-year tax-revenue shortfalls due to the emigration of wealthy Californians, result in low reimbursement rates to providers who care for Medi-Cal patients. Gavin Newsom’s expansion of Medi-Cal eligibility to illegal aliens is costing billions more than the state anticipated. Medi-Cal is also an administrative nightmare for medical practices and their billing departments to work with, requiring massive man-hours to chase down piddling reimbursements.
The problem is acutely felt in OB/GYN care, where Medi-Cal reimbursement for a woman’s clinic visits and delivery might be one-third of the reimbursement for a woman with a private insurance plan. Gynecology services for Medi-Cal patients are particularly unprofitable for doctors.
The situation is so bad that more and more doctors cannot even structure their practices to take some Medi-Cal patients whose care can be “subsidized” by private insurance patients, as was common practice for charitably minded California physicians for years. OB/GYNs are increasingly incentivized to go “all or nothing” with Medi-Cal: either accept only private-insurance patients or receive a high volume of only Medi-Cal obstetric patients with state subsidies while providing almost no gynecology services. The Medi-Cal-only doctors might deliver as many as 50 babies per month, and the lack of gynecology services and high patient load necessarily reduces the quality of care. Most OB/GYNs don’t want to handcuff themselves to that kind of a practice. More Medi-Cal patients, plus fewer doctors and hospitals willing to care for them, mean more women who go without care.
The stats back this up. One in five women in the San Joaquin Valley of California receive no care whatsoever in the first trimester. According to the March of Dimes, over a quarter of California women are failing to receive “adequate” prenatal care.
This crisis with Medicaid is an underdiscussed contributor to abortion. With a limited range of care options, lower-income women in California often have much readier access to abortion than they do to prenatal care. California richly subsidizes abortion: mandating that Medi-Cal and private insurance cover it, eliminating out-of-pocket costs for it, furnishing supplemental payments for nonprofit clinics offering abortion, and doing everything possible to facilitate access to the abortion pill, mifepristone.
Madera County has no maternity ward — but it does have a Planned Parenthood. If a newly pregnant woman in a financially tenuous situation knows that her options for prenatal care are limited, abortion becomes more likely. Almost 70 percent of women report that their abortion was coerced or against their values or preferences, with large numbers citing financial stresses as pushing them into the abortion decision.
How do we incentivize doctors and hospitals to care for more pregnant Medicaid patients? Increasing taxes to increase Medicaid reimbursements is politically untenable at the federal or state levels, particularly in California and other states that already have high taxes. States cannot deficit-spend their way out of the problem as Congress can, and it is unsustainable for Congress to do so indefinitely. The GOP is more inclined to cut Medicaid at the moment than to expand it.
There may be fiscally responsible ways to address the problem. Sally Pipes from the Pacific Research Institute has pointed out that Medicaid funding has become imbalanced, going excessively to able-bodied adults rather than to pregnant mothers, one of the chief “legacy” groups the program is intended to benefit. Restricting Medicaid eligibility with more frequent eligibility checks, work requirements for the able-bodied, limiting federal matching for non-“legacy” groups, and addressing waste (approximately 5 percent of reimbursements, or $31 billion, are wrongly disbursed) could help the program focus more funding on pregnant women and allow for higher reimbursements for OB/GYN care.
There are other models and sources of funding the GOP could look to. Republicans in Congress and individual states are looking to cut funding from Planned Parenthood and other abortion providers — it would be politically savvy to divert such funding to new avenues for genuine prenatal care. Federally qualified health centers have grown at a tremendous pace to serve increasing numbers of Americans; while FQHCs themselves often cannot serve as a woman’s chief source for OB/GYN care, such a model could be useful for prenatal-care provision, perhaps to support or spur the establishment of more nonprofit OB/GYN clinics that chiefly serve lower-income women. Cost savings from defunding Planned Parenthood (which alone received $699 million in fiscal year 2022–23, in Medicaid reimbursements and grants from the Department of Health and Human Services) and other abortion providers could help fund such initiatives.
Directing federal dollars to prenatal care could result in a better long-term financial picture if it helps Americans more readily welcome children. America’s entitlement crisis is driven by the fact that we have too few babies, who must eventually pay taxes to support a growing population of older entitlement recipients.
The sad fact is that, with almost 50 years of Roe v. Wade on the books, Americans got used to abortion being the backstop for poor women facing difficult pregnancies. Dealing with poverty and lack of health-care access with abortion is a false form of compassion that we must reject. But we cannot credibly reject it without sound public policy alternatives that address the grave needs too many women face.