Well Baby Brings Out Insurance Malady

Times Staff Writer

Question: If a woman for medical reasons must remain in a hospital after giving birth, and is covered by hospitalization benefits provided by her employer or her husband's employer, is the child, who obviously also must remain in the hospital, necessarily covered?

The reason I ask this question is that my wife recently gave birth at Santa Monica Hospital's Birth Center to a healthy boy, but because of her complications she had to remain in the hospital for five days. Of course, the child also had to remain near her. Her hospital costs were covered under our medical plan administered by the Aetna Life & Casualty Insurance Co., but not those of the child. Aetna declared that because he was "a well baby," and even though he had to stay at his mother's side at an additional $175 a day, the costs were not covered by its so-called hospitalization plan.

Indeed, the plan penalized us for having a well baby. We could not take the baby home--it would have violated hospital rules and procedures and the advice of doctors. We certainly did not want to. No one wants to separate a child from its mother immediately after birth, but that is what the hospitalization plan, in effect, called for.

The situation seems grossly unfair, if not a violation of the intent of the benefits (covering 80% of all hospitalization) advertised by Aetna and pointed to with pride by the employer.--S.H.K.

Answer: It does, indeed, make for an odd situation in which your hapless new son shapes up as a freeloader hanging around the hospital just to run up his mother's hospital bill.

What were the other options open to you and your wife? Slip the boy cab fare and send him home to wait until his mother was discharged from the hospital? Most peculiar.

Virtually every employer in the country today is going through a belt-tightening, "cost containment" program to hold down medical-care costs, which in recent years have sent health-insurance premiums soaring up to about $100 billion a year--a big, big bite out of revenues. And, as the belt has tightened, the pinch is being felt primarily by employees in a variety of ways--most directly in the form of higher deductibles, forcing employees to pay a greater share of such routine medical expenses as doctors' office calls, prescriptions and lab costs.

But the big bugaboo, the big drain on the insurer/employer pocketbook, has been and continues to be hospital costs, where a routine, uncomplicated stay amounts to hundreds of dollars a day.

And a representative of your company's employee-benefits department is the first to admit that the "problem" of the well baby is, indeed, "a serious bone of contention--a very emotional sort of thing."

Even in a normal pregnancy in which both mother and baby stay only a couple of days, the representative adds, covering the baby's portion of the visit "would average $500 or $600, and because we're experiencing anywhere from 200 to 300 pregnancies a year, we're looking at $150,000 to $200,000 in additional expenses."

Carolyn Rhinehart, Aetna Life & Casualty's supervisor overseeing the administration of your employer's group medical plan, agrees that "the gentleman's indignation is perfectly understandable, but unfortunately we're bound by our contract with his employer. And the contract makes no provision for a well baby."

The main problem, your employer's benefits people suggest, is that while virtually everyone agrees that it would be far preferable to have some provision in the medical plan that would cover the care of a well baby, trapped in the hospital through no fault of his own, it's also difficult to do this without opening the door to a lot of other exceptions.

"We've looked at it and seriously considered it," your benefits-department spokesman adds, "and we'd really like to change the way it works. And in fact, we may someday do it. But, right now, I'm not too optimistic."

Every survey and study your company has commissioned on the complex subject of medical-cost containment, he continues, "says excluding the cost of the well baby's hospital stay is the proper approach to take.

"But, that doesn't necessarily make it right."

Q: I recently had a very disturbing experience with a rent-a-car agency. My brother was here from New York and presented his Visa card to the salesman in order to rent a car. When the fellow finished punching keys on the computer (after 20 minutes), he said: "I received instructions to cut up your card." My brother pleaded with him not to do it and that it was some kind of computer error because it happened before. Apparently the card must be valid because he had just used it in a restaurant and, prior to that, had used it to purchase some airline tickets.

The guy never gave us a chance to explain anything. He cut the card up in several pieces, and I gave him a big piece of my mind. Does my brother have any recourse, and did this man have any right to mutilate someone else's personal property?--A.H.

A: In our plastic society, this is a recurring question, headache and source of vexation.

The problem is that--no matter who the issuer is--a credit card remains the property of the company issuing it, and if sufficient evidence points to its being misused, the company has the right to order its destruction.

(And if the rent-a-car firm doing the cutting up wants to continue doing business with the issuer, it doesn't have many options either. It cuts.)

In virtually every case in which a card is ordered destroyed, one credit-card spokesman said, it means that whoever is on the other end of the computer has good reason to believe that an unauthorized person is using the card--and so the cutting-up is as much for the protection of the customer as it is the card issuer.

No one denies the possibility of glitches. Why did the restaurant and the airline ticket agent accept the card? Probably, the card spokesman volunteered, because they didn't take the time to verify the card.

But the time and place to straighten this sort of thing out isn't in the rent-a-car office in the heat of the moment (the agent has no way of knowing whether it's an error), but as soon as you've gotten home and can approach it rationally.

If the cutting-up was indeed an error, the issuer will be most apologetic (a lot of comfort). And your brother can change cards (and issuers).

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