Newborns Need Coverage Starting on Day One

December 12, 2020 // Heavyn Jennings

Babies need at least seven well-child visits by their first birthday including one after birth and another three to five days after being discharged from the hospital. Health insurance is essential so that families can afford these important visits . Sadly, 4.2% of infants and toddlers are uninsured in Tennessee. This should not be the case. No baby should leave the hospital without health insurance.

Usually, babies are added to their mother’s health insurance after birth, as private insurance plans are required to cover newborns for at least the first 30 days after birth. This gives the parents time to get the newborn enrolled in coverage of their own. Similarly, babies born to mothers on TennCare (including Emergency Medicaid) and CoverKids can get the same coverage as their mom after birth. This arrangement, called newborn deeming, allows babies born to a mother on TennCare or CoverKids to receive automatic coverage for a certain period of time (12 months for TennCare) after their birth regardless of any family income changes.

Unfortunately, not all babies are seamlessly enrolled in coverage. Some families are left to figure out coverage options for their baby after birth notably in the following situations:

  • Mother Uninsured. If a mom is uninsured at the time of birth, she will have to find coverage for her baby after birth. A baby born to an uninsured mother who receives Emergency Medicaid, however, can take advantage of newborn deeming.
  • Mother on Marketplace Plan with low-income. Some women are on marketplace plans but are eligible for TennCare/ CoverKids due to their pregnancy. This means their baby is also eligible for TennCare/CoverKids. Many of these moms do not discover this fact until they give birth. Those eligible for TennCare and CoverKids are not able to receive savings on the marketplace. This issue can arise if the pregnancy was not noted in the marketplace application.
  • Mother dependent on Private Insurance Plan. Babies born to mothers who are under age 26 and are dependents on a family member’s private insurance plan may not be covered by that plan. While the Affordable Care Act made it mandatory for health insurance plans offering dependent coverage to extend the age limit to 26, the ACA does not require plans to cover the children of the dependents receiving the extended coverage. Babies born to these mothers must find coverage elsewhere.

Some of these mothers qualify for TennCare and CoverKids. Mothers can enroll in TennCare even if they also have private insurance because it is permissible to have TennCare as a secondary plan. This would allow babies born to moms on both TennCare and private insurance to receive newborn deeming and any newborn coverage on their parents’ private insurance. Having TennCare as a secondary plan would avoid gaps in coverage for the baby and protect against uncovered medical expenses. They can apply for this coverage after the birth, but they will not be able to take advantage of newborn deeming.

The other problem with applying after birth is if there is a delay, the baby may have uncovered medical bills between the date of birth and the date of application because Tennessee does not have retroactive coverage for Medicaid or CHIP. Tennessee is one of only two states without retroactive Medicaid coverage for newborns. Additionally, Tennessee is 1 of 14 states without retroactive CHIP coverage for newborns. If the family or the birthing hospital does not apply for TennCare or CoverKids on the day the baby is born, the baby will not have coverage on its date of birth. There are no exceptions.

Note: Limited Retroactive Coverage refers to states which have retroactive coverage but have reduced it to less than three months prior to application or have limited it to certain infant groups such as premium-free CHIP.

The lack of retroactive Medicaid and CHIP coverage in Tennessee is an example of a punitive policy that perpetuates the cycle of poverty. Tennessee is operating under a waiver from federal regulations that require retroactive coverage as of the date the applicant becomes eligible up to 90 days prior to submitting the application. Under Tennessee’s policy, babies born to low-income mothers may enter the world in debt.  Families who are eligible for TennCare and are already struggling to pay expenses, should not incur additional financial hardship simply because of enrollment barriers. Tennessee needs to remove its waiver of retroactive coverage, or at least make an exception for newborns.

Even better, babies should be automatically enrolled in coverage before they leave the hospital.  The best practice is for the state to enroll every newborn in TennCare, CoverKids, or Marketplace coverage if the family does not have employer-sponsored insurance. There is no reason that a newborn should be uninsured and in debt. Auto-enrollment of newborns or retroactive coverage would ensure they are off to a great start in life.