Excerpt of Sacramento Bee: By Lisa Rapaport -- There is an increasingly fine line between saving money on health insurance and making a costly mistake - a line most don't know they've crossed until it's too late.

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Two years ago, as newlyweds itching to start a new business, Deborah Elissagaray, 38, and Greg Stokes, 45, jumped at the chance to spend $650 a month on medical coverage for themselves and his three children from a previous marriage.

It was a deal too good to refuse, Elissagaray said, because her husband was born with a heart murmur and had cardiac surgery at age 39. Citing his pre-existing medical condition, some insurers would not sell him coverage at all, and others offered policies that cost more than $1,000 a month.


At the time, it seemed a smart financial move to buy the cheapest insurance available. But now Elissagaray is four months pregnant, with an insurance policy that doesn't cover maternity costs.

To pay for the baby's delivery, she and her husband will draw about $16,000 out of their 401(k) plans. For prenatal care, the El Dorado County couple will use the business operating loan that was supposed to help build a tasting room at their new Pleasant Valley winery, Ursa Vineyards.

The couple would have been prevented from buying their policy under a bill scheduled for a vote today on the Assembly floor. Senate Bill 1555 would make California the first state in the nation to ban the sale of health plans that exclude maternity coverage.

Statewide, an estimated 284,000 privately insured adults lack maternity coverage, according to the California Health Benefits Review Program prepared by the University of California. Two-thirds purchased coverage on their own that did not include maternity, while the rest worked for companies that offered coverage without pregnancy benefits, the study said.

The legislation has wide support from women's health advocates, including Planned Parenthood and the American College of Obstetricians and Gynecologists, who view insurance policies excluding maternity as discrimination against women. While both men and women can get cheaper premiums by purchasing coverage without maternity, only women could be forced to pay for the expense of a pregnancy not covered by insurance.

"Half or more of all pregnancies are unintended," said Kathy Kneer, president of Planned Parenthood Affiliates of California. "While paying for this type of coverage, a woman could become pregnant and then have to pay tens of thousands of dollars in prenatal and delivery costs."

Opponents of the bill, which include business trade groups and health insurers, say it will do more harm than good. They say few women covered by plans without maternity find themselves pregnant, and many people who buy these lower-priced insurance options would be uninsured if premiums were raised to include maternity.

"The issue here is consumer choice," said Michael Shaw, assistant state director at the National Federation of Independent Business. "You have to ask if the added cost everybody would pay so some people can have maternity is worth it."

As a business owner, Elissagaray said she is grateful there was an insurance plan on the market that her family could afford.

"My husband and I were just starting out, we had no income from our new business yet, and we decided to take a risk without maternity coverage," she said. "Quite frankly, I did not expect to get pregnant overnight, at my age."

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