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Friday, February 27, 2015 |  Madison, WI: 3.0° F  Fair
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Madison Birth Center blames its demise on HMO refusal to cover services
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The average on-site birth at the center costs $7,991 and covers prenatal care through six weeks postpartum, including home visits.
The average on-site birth at the center costs $7,991 and covers prenatal care through six weeks postpartum, including home visits.
Credit:Madison Birth Center

You'd think a free-standing birth center in progressive Madison, Wisconsin would be wildly successful, or at least comfortably sustainable. Not so, according to Jennifer Bell, who bought the Aszani Kunkler-founded Madison Birth Center in 2011 and announced its November closing on Tuesday night.

"We had close to 500 inquiries for our service last year. We had 47 births," says Bell, describing a state-of-the-art facility, highly professional, credentialed staff working under market value, and 10 years of top-level care and rigorous accreditation. "So, is demand the problem? There are communities that are far less progressive than Madison that have birth centers just bursting at the seams. But they have HMO inclusion. I'm genuinely confused what the problem is and the only thing I can think of is that there are contracts, discounts, exclusivities, relationships, that are dictating healthcare in Madison."

Bell describes 10 years of an unsuccessful effort to have the birth center covered by each of the four HMOs she says "dominate" the Madison area healthcare environment in a "particularly hostile" manner: Dean Health Plan, Group Health Cooperative of South Central Wisconsin (GCH-SCW), Unity (owned by UW Health) and Physicians Plus (owned by Meriter Health Services). Collectively, the four insure more than a half million members. None will cover the Madison Birth Center or at-home births. Humana, Alliance, nearly all preferred-provider organizations and some WPS plans do currently work with Madison Birth Center. A portion of Unity members with a point-of-service plan just became eligible, but this only began two to three months ago, says Bell.

"At the same outcomes and significantly lower cost, it makes no sense to me where the HMOs are in this outside of what they told us, which was a million different reasons that they were worried about doing business with us," says Bell. "And yet we never received decision criteria. We never received if-then's. There were never any of those processes that were put in place for us to meet so that we could participate in some way that was fair. There were no concrete mechanisms that would help us understand what it would take to get a relationship with them."

The average on-site birth at the center costs $7,991 and covers prenatal care through six weeks postpartum, including home visits. At-home Madison Birth Center midwife-attended births average between $2,500 and $5,000. The average hospital birth, not including physician fees, is $20,491 at Meriter and $18,463 at St. Mary's, according to numbers Bell pulled from the Wisconsin PricePoint System provided by the Wisconsin Hospital Association. Additionally, the national cesarean section rate hit 32.8% in 2011; the average rate among Center clients is 4% to 6%.

"The data says it's not safety. The data says that the cost is significantly less," says Bell. "So, then, what is it?"

There were just over 6,000 births in Dane County last year. For the birth center to sustain its model, one Bell rigorously defends, it needs 100 births per year. But it has served approximately 600 families since opening in 2003, an average of 60 per year. Thirty percent of clients pay out of pocket.

"In this community there is definitely the demand," says Alison Dodge, co-founder of Madison retail shop Happy Bambino. "I can't tell you how many people have said to me, 'I wanted to have my baby at the Birth Center or I wanted to have my baby at home but my insurance didn't cover it.' It's really about a financial model that doesn't work without insurance participation. And it's sad, because it's really limiting women's choices. And that's not fair because it's limiting them from a higher quality of care."

Dodge says the birth center is more than a place to give birth; it empowers families to make non-traditional birthing decisions and provides a community hub.

"I think the Birth Center helped normalize out-of-hospital birth because it was combining something new (out of hospital) with something that people were kind of able to wrap their heads around, which is going someplace to have your baby," says Dodge. "Just like Happy Bambino, it's another place that's been a gathering point for people and for action and advocacy around breastfeeding and birth options and women's health. For that reason alone, it's a real loss."

The center's announcement on its Facebook page displayed dozens of comments and 74 shares of the announcement at press time. "This is such sad news," said one commenter. "I, too, can't believe a town like Madison can't keep a business such as yours thriving. The local HMOs have a chokehold on our birthing options."

For Bell, who praises the strength and professionalism of the local birthing community and feels "highly responsible for letting a community down," it's critical Madison understands not only that the center will remain fully operational until its close on November 30, but that the staff has gone above and beyond to provide stellar services at great personal cost.

Bell says the center was essentially subsidized by underpaid employees and members of the community. At the end of the day, "the community really needs to stand up if they want the service," she says.

"If I was to say there was a way to run this business in Madison, it would be for HMOs to participate and give us a fair and equal opportunity to provide completely equitable services at a significantly lower cost. Isn't that what HMOs are about?"

Calls to Dean Health Plan and GHC-SCW were not returned. In a statement to the Wisconsin State Journal, Physicians Plus spokesman Scott Shoemaker said UW Health nurse midwives are available for Meriter Hospital births but "adding other providers without demand for it would be costly."

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