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Free breast pumps and the cost of health care
Originally published on Fri January 25, 2013 2:12 pm
Health insurance plans now have to cover the full cost of breast pumps for nursing mothers. This is the result of a provision in the Affordable Care Act (aka Obamacare), and the new rule took effect for many people at the start of this year.
It's led to a boom in the sale of the pumps, which can cost hundreds of dollars.
Yummy Mummy, a little boutique on New York's Upper East Side, has suddenly become a health care provider/online superstore. The company has been hiring like crazy, and just opened an online call center and a warehouse in Illinois. Yummy Mummy even hired somebody to talk to customers' health insurance companies.
And new moms now seem more likely to splurge on fancy new breast pumps. Caroline Shany, a Yummy Mummy customer, spent her own money to buy a breast pump for her first baby. She may buy another one now because insurance will pick up the tab.
"Why not?" she says.
Weird things happen when you take price out of the equation for consumers. For one thing, they stop looking for the best price. But even though breast pumps are free for new moms, somebody has to pay for them.
"Health insurance premiums are driven by how much we spend on health care," says Harvard health economist Katherine Baicker. "The more things that are covered by health insurance policies, the more premiums have to rise to cover that spending."
Advocates of requiring insurance companies to pay for breast pumps say that the measure will pay for itself in the long run. Babies that are breast fed tend to have fewer health problems, and paying for breast pumps should mean more babies are breast fed.
Whether that happens may depend partly on how the new rules are implemented. Insurers are still trying to figure out whether to pay for extra-fancy breast pumps, or just basic models.