What newborn insurance options are available to me?

Q: What newborn insurance options are available to me?

A: A newborn insurance (sometimes also called NICU insurance) is an insurance policy covering hospital expenses of the newborn when he or she is born. Sometimes, a newborn requires intensive medical care immediately after birth. This kind of insurance helps cover the costs associated with specialized medical treatment and care a newborn may need in the NICU (neonatal intensive care unit). Here are some possible scenarios that a newborn may require intensive care unit.

• Premature birth: Babies born before 37 weeks of gestation may require NICU care due to undeveloped organs and systems.
• Low birth weight: Newborns weighing less than 2.5 kilograms may need intensive care to help them gain weight and develop properly.
• Respiratory distress: If a newborn has difficulty breathing (for example, due to respiratory distress syndrome), he or she may need to be placed on a ventilator.
• Infections: Newborns with infections may require treatment in NICU. Infections include sepsis, pneumonia, meningitis, and other serious infections.
• Congenital disorders: Babies born with congenital disorders or genetic disorders may need intensive medical care.
• Birth complications: Complications during birth, such as umbilical cord problems, meconium aspiration, or emergency C-sections, can result in the need for NICU care.

The cost of NICU in a private Mexico hospital may be in the range of $1,000 USD to $2,000 USD per day. A top-tier care in a very expensive private hospital can charge up to $15,000 USD per day. Many intended parents cannot afford the hospital fees when their baby stays in the hospital for 2 weeks or more. A newborn insurance is designed to cover the cost beyond the deductible.

There are several options for intended parents to purchase a newborn insurance.

1. An agency-provided insurance plan. Often, an agency can provide you an option to purchase an NICU insurance. Your agency may know a good insurance carrier, or it may be “self-insuring” it. To “self-insure” means the agency collects money from multiple intended parents and pays out if an intended parent’s newborn requires NICU. In other words, the agency is acting as its own insurance underwriter. In any case, you’ll be paying the cost for an NICU insurance to your agency. If you choose to purchase a NICU insurance provided by your agency, ask what kind of insurance it is. Because most Mexican insurance companies don’t offer NICU insurance, you might be purchasing a self-insured insurance offered by the agency. In this case, if the agency refuses to pay a large hospital bill or goes bankrupt, there is little or no recourse for the intended parent.
2. An international insurance that you purchase. You can look for and purchase an international newborn insurance for your newborn before your surrogate becomes pregnant. These insurance plans have a clause specific to surrogacy. There are very few selections available, and the premium varies widely, ranging from around $4,700 USD to $20,000 USD or more.
3. A private US insurance or group insurance from your employer. If you are a US resident, you may have a private health insurance. It could be purchased individually or offered by your employer. Some US insurances have a clause that covers the cost of newborn born outside the country, including NICU costs. Make sure to review your policy well in advance of your anticipated delivery date. If your insurance doesn’t cover newborns born through surrogacy, you may want to purchase an insurance that has a clause for medical costs of newborns born outside the country. When you are looking for a private insurance, make sure surrogacy is not an excluded condition.
4. An expat insurance covering yourself. If you are an expat, you might have an expat insurance covering yourself for a period of time, and when the newborn is born, you may be able to add your newborn in order to cover his or her potential NICU costs. Note that in order to be considered an expat, you have to live in a foreign country for 6 months or more during the year your baby is born. Also, note that most expat insurances no longer cover newborns born through surrogacy. If you already have an expat insurance, check the policy to see if it covers medical cost of newborns born out of country through surrogacy.

Whichever you choose, you should read the specific text of the insurance policy to make sure that the cost for NICU stay is covered.

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