Northern California Has Highest Costs in the U.S. to Deliver a Baby

Sacramento and the San Francisco Bay Area ranked as the most expensive places to have a baby of 30 major metropolitan regions in the U.S. according to an analysis released Thursday.

Sacramento came in first (congrats to you) where a vaginal birth cost $15,420 on average. The San Francisco Bay Area was a close second at $15,204. Minneapolis trailed in third place by almost $4,000, coming in at $11,527, and the least expensive of the 30 largest metropolitan areas surveyed was Kansas City, Missouri, where a vaginal delivery costs an avery $6,075.

These are "routine vaginal deliveries," folks. Again, those are "average" costs. We'll get to the variation within regions further down.

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The numbers were crunched by San Francisco-based Castlight, a health care information company. They looked at medical claims data as well as other information. Since Castlight primarily works with self-insured large companies, it says the costs it crunched include both the employee's out-of-pocket costs and what the employer paid for the delivery.

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Birth by Cesarean section typically cost more than vaginal deliveries and did in this survey as well. Sacramento was first at $27,067; the Bay Area was second at $21,799. Portland, Oregon trailed in third at $18,066. The least expensive of the metropolitan areas was Pittsburgh, Penn. at $6,891.

Here's the national C-section map:

top_30_cities_delivery_maps_csection

But Castlight didn't actually stop at the 30 biggest metropolitan areas. They surveyed 190 areas across the country, including 13 in California.

While Sacramento and the Bay Area are the most expensive major regions to have a baby, other, smaller, California cities rank even higher.

Here's the list for routine vaginal deliveries in California:

Merced $19,191
Salinas    $17,772
Sacramento-Yolo $15,420
SF-Oakland-San Jose $15,204
Stockton-Lodi $13,972
San Luis Obispo-Atascadero-Paso Robles $13,926
Santa Barbara-Santa Maria-Lompoc $12,219
Bakersfield $11,055
Los Angeles-Riverside-Orange $10,285
Modesto $9,903
San Diego $9,709
Chico-Paradise $7,839
Fresno  $7,278

In addition to the cost difference between areas, there's tremendous cost variation within regions, too. In the Bay Area, the range for a vaginal delivery is $7,700 to $28,000, a four-fold difference. In Sacramento, it's $4,560 to $24,549, a five-fold difference.

Feeling ill yet?

If you're wondering why this happens, Kristin Torres Mowat, senior vice president at Castlight, chalked it up to the "obscure, dysfunctional and inefficient health care market."

In Northern California, consolidation on the provider side -- both doctors and hospitals -- helps them to wield market power and drive up costs.

The most recent evidence came earlier this month in a study from  USC health economists who pointed, again, to the market power of Sutter Health and Dignity Health.

"Over time, they have acquired physician practices, outpatient clinics, hospitals and have a disproportionate share in the market," Mowat said.

(Disclaimer that data from Kaiser Permanente was not included in the USC study.)

Mowat advised that consumers ask for an estimate of costs early in their pregnancy, but that estimate is not always easy to get.