By Leslie Small

Over the past two decades, the number of neonatal intensive care unit (NICU) beds has exploded while the overall number of newborns has remained relatively stable. The result, according to an extensive new study from Dartmouth University, is that nearly half of all newborns admitted to NICUs in the U.S. are of normal birth weight — patients who have “less to gain from intensive care yet are still exposed to the possible adverse effects of a hospital setting designed primarily for critical care.”

One factor driving this trend may be the notion that “more care is always better,” says David C. Goodman, M.D., of The Dartmouth Institute for Health Policy & Clinical Practice at the Geisel School of Medicine at Dartmouth College. Then there are the financial incentives, as “NICU care is expensive, it’s well paid for, it generally has high margins enjoyed by hospitals, and most of it is paid for on a volume basis,” he notes.

Yet from what Goodman has observed, health insurers haven’t done much to curb unnecessary use of the NICU. Why? One reason is that quality measures are not well developed for newborn populations, he points out. But also, “it’s very easy for providers to push back on managed care interest in decreasing overuse by claiming that they’re just interested in saving money,” he says.

The report — which looked at data from the Centers for Disease Control and Prevention’s National Center for Health Statistics, Texas Medicaid, and Anthem, Inc. commercial and Medicaid plans — also found that the amount and type of neonatal care delivered varied considerably across regions and hospitals. Further, it found that regions of the country with a high proportion of factors related to newborn illness generally are not the regions with higher supply of NICU beds or neonatologists.