As readers of Say Ahhh! know, 2027 will bring a host of unprecedented Medicaid changes, including work reporting requirements. One less prominent change ahead is adoption of new maternity care codes for insurance payers. Adopting new codes for maternity care adds to the long list of Medicaid agency to-dos, but remains critical for understanding and addressing the causes of maternal morbidity and mortality among the more than four in 10 people with Medicaid-financed maternity care.
For decades, maternity care has largely relied on a “global” or bundled billing approach. This meant that prenatal, birth/delivery, and postpartum care services were frequently financed under one bundled payment. In particular, the birth and postpartum care were nearly always lumped together. Few financial incentives existed to offer more visits or otherwise provide more intensive or specialized services to those who needed them. The health care system and maternity care have changed dramatically in the past 30 years, but the bundled maternity billing codes have not similarly evolved. Until now.
Coding Changes are Coming in January
The American Medical Association (AMA), in collaboration with the American College of Obstetricians and Gynecologists (ACOG), American Academy of Family Physicians (AAFP), and other medical specialty organizations, worked for two years to design a new, “unbundled” maternity care code set. On January 1, 2027, the global billing approach will be replaced with a new and restructured Current Procedural Terminology (CPT®) code set for maternity care.
The new approach reorganizes maternity care coding and billing around four distinct phases: 1) inpatient and outpatient prenatal (antepartum) care, 2) labor management from the start of labor until delivery, 3) delivery services at the time of birth, and 4) inpatient and outpatient postpartum care. Prenatal care and postpartum care will become more flexible in terms of number of visits and location. Labor management and delivery care codes also reflect variation in complexity.
This is Not Just a Coding Change – it can Help to Place Incentives in the Right Places
The 2027 coding transition will change billing for prenatal, birth, and postpartum care. Right now, providers, hospitals, health plans, Medicaid agencies, managed care organizations, and others should be preparing for the change. Maternity care/obstetric provider practices—including obstetrician-gynecologists, family physicians, and midwives—will need planning and training.
While the 2027 maternity care code changes are projected to be budget neutral, budget neutrality at the system level does not translate into neutral impact for states, systems or providers. The new approach redistributes revenue based on how care is delivered and how frequently patients are seen. As a result, some providers may receive increased revenue, while others could see less.
Coding Changes Should Not Affect Federal Protections on Out-of-Pocket Costs
Medicaid explicitly prohibits out-of-pocket costs for pregnancy-related services, including prenatal care, birth, and postpartum care. Under the Affordable Care Act, most people with Marketplace or employer-based insurance can receive a wide range of preventive services without out-of-pocket costs. The list of preventive services related to maternity care includes (but is not limited to) prenatal and postpartum visits, breastfeeding support, and screening for diabetes, hypertension, and depression. The coding changes do not affect these protections.
The “Unbundling” Opportunity for Patients, Providers, and Payers
The new coding structure brings potential for tangible improvements for maternal health, if implemented with care. Highlights include:
Support for modern team-based care in a complex health system: The new codes are designed to better support modern, team-based care. Today, care is often provided by multiple providers throughout the 20+ months from prenatal through one year postpartum. For example, people may receive prenatal and postpartum care at a community health center and go to a hospital at the time of birth or use a midwife for prenatal care but a family practice setting for postpartum and primary care following the birth.
More individualized care that manages risks and complications: The recommendation is for a tailored prenatal care approach with a patient-centered plan of care that is adjusted according to the medical and health-related social needs, instead of the old “one-size fits all” thirteen prenatal visits. Relatedly, the codes can also be tailored to address individual risks or complications related to maternal morbidity and mortality by encouraging payment for more prenatal visits when needed, more time with people experiencing longer or complex labor and delivery, transfers to risk appropriate care for mother and baby, and/or multiple postpartum visits.
Improved attention to maternal mental health: The Policy Center for Maternal Mental Health sees potential for innovation and improved care as a result of new codes. For example, going forward, payers can incentivize maternal health providers to provide routine mental health screening and a warm-hand off.
Improved measurement and transparency with data to guide quality improvement and incentives. The new coding approach should allow for a more nuanced look at care utilization, including the improved ability to measure and finance care. Previously, it was difficult to get reliable data even for postpartum visits.
Proposed CMS Rule Creates an Added Hiccup to Smooth Transitions to New Medicaid Codes in 2027
A Proposed Rule by the Centers for Medicare & Medicaid Services including “CY 2027 Payment Policies Under the Physician Fee Schedule” was issued on July 16, 2026 (comment period ends on September 14, 2026) which seeks feedback on inclusion of 15 new “G” codes that would preserve the global maternity payment structure alongside the new AMA/ACOG unbundled codes, both set for January 1, 2027. While CMS intends for these G codes to be used in the transition, ACOG and others are rightfully concerned that these parallel G codes may cause disruption and confusion by adding even more administrative burden for providers and forcing them operate under two separate billing structures.
How is Medicaid Responding in Your State?
Many state Medicaid agencies have already unbundled maternity care payments or are in the process of doing so this fall, while many others may gave more work to do to be ready. States like California, Iowa, and Washington State have posted or disseminated announcements and updates about this change and where they stand in the transition process.
Maternal health leaders and advocates can encourage Medicaid agencies to proactively support transition to the new maternity codes by:
- Send comments by September 14 to discourage CMS from promulgating final rule on G-Codes;
- Creating fee schedules and reimbursement structures to help translate the move from global to more itemized payment across the for phases of care, ensuring payments remain equitable and sufficient to maintain each provider type;
- Revising managed care organization (MCO) and provider contract language (while no change in contractual terms may be required, modifications to reimbursement methodologies will be needed);
- Updating provider manuals;
- Creating enrollee outreach materials related to pregnancy, birth, and postpartum care (booklets, websites, etc.);
- Publicly reporting MCO quality and performance measures;
- Revising claims submission forms and procedures; and
- Updating/enhancing data systems that may allow for use by groups such as Maternal Mortality Review Committees (e.g., dashboards, billing programs).
As we look into all the changes ahead in 2027, naturally we also worry about the possible impact of work reporting requirements on pregnant and postpartum enrollees in expansion states. Ideally, successful implementation of the new codes could help to better identify pregnant enrollees based on the care they receive. The overlapping implementation may make this more challenging in the near term, but states focused on ensuring exemptions for enrollees may be able to use the new codes as a tool.
For More Information:
- Payment for Obstetric Services, ACOG
- Beyond the bundle: Key implementation considerations for the 2027 unbundling of maternity care payment. Policy Center for Maternal Mental Health
- Maternity Care Unbundled What States, Health Plans, Providers, and Maternal Health Innovators Should Prepare for Ahead of January 1, 2027, Manatt Health