The AMA’s new obstetric coding model is being widely discussed at present in the OB-GYN world. But beneath the surface, this is not just a coding update.
It is a structural shift in how obstetric care is delivered, documented, and financially valued.

A New Model for Obstetric Care

Beginning in 2027, the traditional global obstetric package will be replaced by a fully unbundled, encounter-based model.

In practical terms:

Prenatal visits transition to E/M-based billing

Delivery is billed separately

Postpartum care becomes independently billable

Ancillary services are no longer absorbed into a bundle

This marks a clear move away from bundled reimbursement toward visit-level financial capture.

Where This Model Moves Us Forward

For years, a significant portion of obstetric care has gone under-recognized financially.

This model begins to address that gap.

Postpartum care now extending to 12 weeks, can finally be captured

Counseling, coordination, and mental health support gain visibility

High-risk pregnancies can be more accurately reflected

Non-procedural care is no longer financially invisible

At its best, this model aligns reimbursement with the true scope and complexity of care.

The Overlooked Financial Shift

There is, however, a critical nuance that is not being discussed enough.

A typical obstetric visit is rarely “routine.”

A patient may present for prenatal care but also require management of:

Infection (yeast, UTI)

Blood pressure concerns

New or evolving symptoms

Emotional or mental health support

Historically, this allowed for:

A routine OB component

Plus a separately billable E/M service

This structure more closely reflected the breadth of clinical work performed.

What Changes at the Visit Level

In the new model, that distinction is largely removed.

All care delivered during the encounter is expected to be captured within a single E/M visit, with complexity adjusted accordingly.

While this simplifies billing, it also introduces a financial ceiling per encounter.

Using approximate Medicare benchmarks:

99213 reimburses around $90

99214 reimburses around $125

The incremental difference between levels is limited.

Previously, a combined visit could represent a higher total value.
Now, even with appropriate documentation, reimbursement is often compressed into a narrower range.

From Bundled Predictability to Performance-Based Revenue

This shift changes the financial model of obstetrics in a fundamental way.

Under global OB:

Revenue was predictable

Variability was contained

Under the new model:

Revenue is distributed across multiple encounters

Each visit becomes a point of financial capture—or loss

Outcomes will now depend on:

Documentation precision

E/M leveling accuracy

Visit structuring

Payer behavior

In effect, obstetrics becomes increasingly decision-making driven from a reimbursement perspective.

The Opportunity Within the Change

This model is not inherently limiting. It is selective.

It creates new opportunities for practices that adapt intentionally:

Additional postpartum visits can be captured

Increased patient touchpoints become billable

Preventive and counseling services gain recognition

High-risk care can consistently support higher complexity

Over the full pregnancy episode, these elements have the potential to offsetand in some cases exceed per-visit compression.

But that outcome requires strategy, not assumption.

A Redefinition of Value

What we are seeing is not simply a change in billing mechanics.

It is a redefinition of how value is assigned in obstetric care.

We are moving from:

Bundled, episode-based reimbursement
to
Granular, performance-driven reimbursement

Where financial outcomes are closely tied to how effectively clinical work is translated into documented complexity and structured encounters.

Final Perspective

This transition is neither purely favorable nor unfavorable.

It is a redistribution of revenue based on operational maturity.

Some practices will experience margin compression

Others will realize meaningful financial upside

Most will fall somewhere in between

The difference will be determined by how quickly and how thoughtfully they adapt.

Because ultimately, this change will not just influence billing.

It will shape how obstetric care is organized, delivered, and valued moving forward.

Renu Joshi, MD, MBA, FACOG
Board-Certified OB-GYN | Healthcare Executive | Founder | Innovator in Women’s Health, AI & Revenue Cycle Management

Dr. Renu Joshi is a board-certified OB-GYN physician with over 15 years of clinical and surgical expertise in high-risk obstetrics and advanced minimally invasive gynecologic surgery, including laparoscopic and robotic procedures. She is also a healthcare entrepreneur, physician leader, and executive with an MBA from the University of Pittsburgh’s Katz Graduate School of Business. Dr. Joshi is further advancing her expertise in healthcare innovation through Harvard Medical School’s “AI in Healthcare: From Strategies to Implementation” program, focused on the integration of artificial intelligence into clinical operations, healthcare systems, and revenue cycle transformation.

A pioneer in both medicine and business, Dr. Joshi founded Joshi Womencare, a successful private practice launched during the COVID-19 pandemic, which achieved breakeven in just three months. She is also the founder of Pract-Eaze, a thriving physician-led revenue cycle management company that became profitable within its first month and supports private practices with comprehensive billing, coding, operational, and revenue optimization solutions.

Throughout her academic and professional career, Dr. Joshi has consistently combined clinical excellence with strategic leadership. She served nearly a decade as an Assistant Professor at UPMC Magee-Womens Hospital, where she led initiatives in obstetric safety, robotic surgery, and outpatient innovation. Her leadership roles across hospital committees helped standardize protocols for postpartum hemorrhage management, EMR integration, expansion of contraceptive access, and improvement of OB-GYN care delivery across diverse patient populations.

She is a respected educator who has received multiple awards for teaching during residency and faculty service and is frequently featured as a medical expert on television. Beyond clinical practice, Dr. Joshi is a connector and community builder, having founded SAWPNA, a national nonprofit organization for South Asian women physicians with over 6,000 members, as well as a 1,000-member private practice OB-GYN network focused on education, collaboration, and physician support.

Dr. Joshi’s work is guided by a mission to elevate women’s healthcare through innovation, education, artificial intelligence, and sustainable physician practice models that empower both patients and healthcare organizations.