Financial FAQ

Surrogacy costs include various expenses such as agency fees, surrogate compensation, medical expenses, legal fees, and additional costs related to pregnancy and childbirth. 

The cost of surrogacy can vary widely based on a range of factors including the country where it takes place, the type of surrogacy (gestational or traditional), agency fees, legal fees, surrogate compensation, and medical expenses related to the pregnancy. Here’s a general breakdown:

  • Agency Fees: When you go through a surrogacy agency, you can expect to pay fees for their services, which include matching you with a surrogate, coordinating the process, and providing support. These fees can range from $20,000 to $30,000 or more.
  • Surrogate Compensation: Compensation for the surrogate (in countries or states where it’s legal) varies significantly. In the United States, for example, compensation can range from $30,000 to $50,000 or more, depending on the location and the surrogate’s experience.
  • Medical Expenses: This includes costs for fertility treatments, embryo creation and transfer, prenatal care, and the birth. These expenses can vary greatly but may range from $50,000 to $100,000 or more.
  • Legal Fees: Legal expenses can include drafting and finalizing contracts, establishing parental rights, and other legal considerations. These costs can range from $10,000 to $20,000.
  • Additional Costs: Other costs might include insurance for the surrogate, travel expenses, and any necessary accommodations during the pregnancy or medical visits. These can add thousands of dollars to the overall cost.

Yes, there are financing options available for surrogacy, including payment plans, loans, grants, and fundraising campaigns to help intended parents cover the costs associated with the process.

There are several financing options available to help cover the costs of surrogacy, which can be substantial. Many intended parents explore various financial resources to fund their surrogacy journey. Here are some common financing options:

Personal Savings

  • Many intended parents start by using their personal savings, planning and saving in advance for the costs associated with surrogacy.

Loans

  • Personal Loans: Banks and credit unions may offer personal loans that can be used to finance surrogacy. Interest rates and terms vary, so it’s important to shop around.
  • Specialized Fertility Loans: Some financial institutions and lenders offer loans specifically designed for fertility treatments and surrogacy. These may have terms tailored to the unique aspects of surrogacy financing.

Home Equity Lines of Credit (HELOC)

  • If you own a home, a HELOC allows you to borrow against the equity in your home, often at a lower interest rate than personal loans.

Fundraising and Crowdfunding

  • Some intended parents turn to online crowdfunding platforms to raise funds. This can also be a way to involve friends, family, and the broader community in your journey.
  • Fundraising events and community support initiatives are other ways to gather financial support.

Grants and Scholarships

  • There are several organizations and charities that offer grants and scholarships to help cover the costs of fertility treatments and surrogacy. Eligibility criteria and available amounts vary.

Health Care Flexible Spending Accounts (FSAs)

  • If you or your partner have access to an FSA through your employer, you may be able to use pre-tax dollars to cover some surrogacy-related medical expenses, reducing the overall cost.

Employer Benefits

  • Some employers offer fertility benefits that include surrogacy support, or you may be able to negotiate surrogacy financing as part of your compensation package.

Insurance Policies

  • While rare, some insurance policies may cover certain aspects of surrogacy, particularly medical procedures like IVF. Reviewing existing policies or looking for surrogacy-friendly insurance plans can be beneficial.

Financial Planning and Advising

  • Consulting with a financial planner who has experience with surrogacy can help you explore all available options, manage your finances throughout the surrogacy process, and plan for the future needs of your growing family.

Financial risks in surrogacy may include unexpected expenses, failed attempts, legal challenges, and the possibility of financial loss if the process is not successful. 

Pursuing surrogacy involves several financial risks that intended parents need to consider carefully. Here are some of the key financial risks associated with surrogacy:

High and Variable Costs

  • Uncertain Total Cost: The total cost of surrogacy can be difficult to predict and may vary significantly. Unexpected medical complications, multiple IVF cycles, or legal issues can increase costs beyond initial estimates.

Insurance Coverage Limitations

  • Limited or No Coverage: Surrogacy-related expenses may not be fully covered by health insurance policies. Some insurance plans explicitly exclude surrogacy, leading to high out-of-pocket costs for medical procedures, prenatal care, and delivery.

Surrogate Compensation and Expenses

  • Variable Compensation: The compensation for the surrogate can vary widely and may increase if complications arise or if multiple pregnancy attempts are necessary. Additionally, there could be unexpected expenses related to the surrogate’s pregnancy or health needs.

Legal Complexities

  • Legal Fees: The need for specialized legal services to navigate surrogacy agreements, parental rights, and potential disputes can lead to significant legal expenses.
  • Jurisdictional Risks: Legal regulations around surrogacy vary by country and state, potentially complicating the process and adding to costs.

Multiple Pregnancy Attempts

  • IVF and Embryo Transfer Failures: Surrogacy often involves in vitro fertilization (IVF), which may not be successful on the first attempt. Multiple IVF cycles can significantly increase the overall cost.

Pregnancy and Birth Complications

  • Medical Complications: Complications during pregnancy or birth can lead to additional medical expenses, including costs for extended hospital stays, specialized medical care, or neonatal intensive care.

International Surrogacy Risks

  • Currency Fluctuations and Legal Changes: For international surrogacy, currency exchange rates and sudden changes in foreign legal regulations can introduce financial unpredictability and risks.

Mitigating Financial Risks

  • Comprehensive Surrogacy Contract: A well-drafted surrogacy agreement that clearly outlines financial responsibilities, including how unexpected expenses are handled, can provide some protection against financial uncertainties.
  • Financial Planning: Working with a financial advisor who understands the complexities of surrogacy can help intended parents plan for the costs and risks involved.
  • Research and Due Diligence: Thorough research and selection of reputable surrogacy agencies, legal representatives, and fertility clinics can help minimize risks.
  • Insurance Review: Carefully reviewing insurance options, including seeking surrogacy-specific insurance policies, can mitigate some of the financial risks.

Surrogate expenses may include compensation for time, effort, and inconvenience, as well as reimbursement for medical expenses, maternity clothing, travel, and other related costs.

Surrogate compensation and expense coverage can vary based on the surrogacy agreement, the agency (if one is involved), and local laws. However, certain expenses are commonly covered for surrogates to ensure they do not incur out-of-pocket costs for their generous commitment to helping intended parents build their families. Here’s a breakdown of typical expenses covered:

Medical Expenses

  • All Pregnancy-Related Medical Costs: This includes prenatal visits, medications, ultrasounds, and any other tests or treatments related to ensuring the health of the surrogate and the baby.
  • Maternity Wardrobe: As the surrogate’s body changes, she will need maternity clothes. An allowance for these is often included.
  • Insurance Deductibles and Co-Pays: If the surrogate’s insurance is used, the intended parents usually cover any deductibles and co-pays.

Surrogate Compensation

  • Base Compensation: Surrogates receive base compensation for their time, effort, and the physical and emotional investment of pregnancy. This is agreed upon before the pregnancy and is often paid out in installments throughout the pregnancy.
  • Additional Compensation: This can include payments for invasive procedures (e.g., embryo transfer, amniocentesis), carrying multiples, and if a cesarean section is required.

Psychological Support

  • Counseling Services: Mental health support before, during, and after the pregnancy is crucial for the well-being of the surrogate.

Legal Fees

  • Surrogate’s Legal Representation: The intended parents typically cover the cost of independent legal counsel for the surrogate to ensure she fully understands the surrogacy agreement and her rights.

Travel Expenses

  • If the surrogate needs to travel for medical appointments, especially if the clinic is in another city, these costs are covered. This can include transportation, lodging, and a per diem for meals.

Miscellaneous Expenses

  • Lost Wages: If the surrogate must miss work due to pregnancy-related appointments or bed rest, she may be compensated for lost income.
  • Childcare and Housekeeping: If the surrogate requires bed rest or is unable to perform certain tasks during the pregnancy, the cost of childcare for her existing children and housekeeping services may be covered.

Insurance

  • Life Insurance: A policy may be taken out on the surrogate to provide financial protection for her family in the unlikely event of her death.
  • Health Insurance: If the surrogate does not have health insurance, or if her existing insurance does not cover surrogacy, a policy that covers the pregnancy and delivery may be purchased by the intended parents.

While surrogacy costs are typically outlined in contracts and agreements, it’s essential for intended parents to be aware of potential additional expenses or unforeseen costs that may arise during the process. 

In surrogacy, while most costs are planned and accounted for in the surrogacy agreement, there can be unexpected or “hidden” costs that intended parents should be aware of. Understanding these potential costs upfront can help manage expectations and financial planning. Here are some areas where hidden costs may arise:

Medical Costs Beyond Predictions

  • Unanticipated Complications: Pregnancy or birth complications requiring additional medical care, hospital stays, or procedures not covered by insurance can increase costs.
  • Multiple IVF Attempts: If the first attempt at IVF does not result in a successful pregnancy, subsequent cycles will increase the overall cost.

Insurance Gaps

  • Surrogate Health Insurance: If the surrogate’s insurance policy does not cover surrogate pregnancies or specific complications, intended parents may be responsible for these medical costs.
  • Life Insurance: Additional premiums for life insurance policies for the surrogate may be higher than initially estimated.

Legal and Administrative Fees

  • Legal Complexities: Complex legal situations or requirements for establishing parental rights in your jurisdiction may necessitate additional legal services and fees.
  • Surrogate Agreement Adjustments: Changes to the surrogacy agreement or unforeseen legal considerations may incur additional legal costs.

Surrogate Care and Support

  • Unexpected Support Needs: The surrogate may need unforeseen support, such as additional childcare, housekeeping, or transportation due to pregnancy complications or doctor’s orders for bed rest.

Travel and Accommodation

  • Travel Expenses: If the surrogate lives far from the intended parents or the chosen fertility clinic, travel costs for medical appointments or for the intended parents to be present at the birth can add up.
  • Accommodation for Birth: Intended parents may need to budget for extended stays near the surrogate’s location around the time of birth.

Emotional and Psychological Support

  • Counseling Services: Both surrogates and intended parents might require more extensive psychological support than anticipated, which can lead to additional costs.

Multiples

  • Carrying Multiples: If the pregnancy results in twins or more, this often leads to higher medical costs, a higher surrogate compensation rate, and potentially more childcare costs for the surrogate.

Post-Birth Costs

  • Postpartum Care: The surrogate’s postpartum care, especially if there are complications after the birth, may not be fully covered by insurance.

To mitigate the impact of these hidden costs, intended parents can:

  • Thoroughly Review Insurance Policies: Understand what is and isn’t covered by the surrogate’s health insurance and your own policies.
  • Comprehensive Surrogacy Agreement: Ensure the surrogacy contract details how unexpected costs will be handled.
  • Financial Planning: Consider setting aside a contingency fund to cover unexpected expenses beyond the estimated surrogacy budget.

Government grants for surrogacy are relatively rare, but some countries or regions may offer financial assistance or support programs for individuals or couples pursuing surrogacy.

Government grants specifically designated for surrogacy are rare, and availability can vary significantly depending on the country and its laws regarding assisted reproductive technologies (ART) and surrogacy. Here’s an overview based on general practices: 

United States

  • In the U.S., there are no federal government grants specifically aimed at funding surrogacy. Some state or local programs might offer assistance for fertility treatments, but these rarely cover surrogacy expenses. However, certain tax credits, like the Adoption Tax Credit, may indirectly benefit some intended parents, although it’s primarily for adoption-related expenses. Consulting with a tax advisor is advisable to explore any potential tax benefits related to surrogacy.

Canada

  • Canada has a more supportive stance on ART but still does not offer direct government grants for surrogacy. The Assisted Human Reproduction Act regulates surrogacy, focusing on health and ethical standards rather than financial assistance. Canadian intended parents typically explore private funding options, insurance, or loans for surrogacy-related costs.

United Kingdom

  • The UK’s National Health Service (NHS) does provide some funding for fertility treatments, but this does not extend to surrogacy. Surrogacy in the UK operates on an altruistic model, with surrogates only being reimbursed for their expenses rather than receiving payment. Intended parents generally need to cover these expenses themselves, without specific government grants available for this purpose.

Australia

  • Australia also follows an altruistic model for surrogacy, with no direct government grants available for surrogacy expenses. Some health insurance policies may cover parts of the IVF process if it’s medically necessary, but the surrogacy journey largely requires private funding by the intended parents.

Other Countries

  • Laws and financial support for surrogacy vary greatly around the world. In many countries, surrogacy is either not legally recognized or is heavily regulated, limiting the availability of any government financial assistance for surrogacy.

Tax laws regarding surrogacy expenses vary by country and region, with some jurisdictions offering tax deductions or credits for certain medical expenses or adoption-related costs. 

Tax deductions and credits for surrogacy expenses vary significantly by country, and within countries, depending on local laws and tax codes. Here’s an overview of how some places handle tax considerations for surrogacy expenses:

United States

  • Medical Expense Deduction: As of my last update, in the U.S., some surrogacy expenses may qualify for the medical expense deduction if the costs exceed 7.5% of your adjusted gross income (AGI) and if the expenses are for the diagnosis, cure, mitigation, treatment, or prevention of a disease. However, this does not typically cover the cost of paying a surrogate but may include certain medical procedures and fertility treatments.
  • Adoption Tax Credit: This credit is specifically for adoption-related expenses and does not apply to surrogacy expenses.

Canada

  • In Canada, there are no specific tax credits or deductions for surrogacy expenses. Canadian taxpayers can claim medical expenses for themselves, their spouse, or dependents, but surrogacy arrangements are generally excluded.

United Kingdom

  • The UK does not offer tax deductions or credits for surrogacy expenses. The cost of fertility treatments may be partially covered by the National Health Service (NHS) for eligible individuals, but this does not extend to surrogacy.

Australia

  • Australia’s tax system does not provide specific deductions or credits for surrogacy. Some medical expenses related to fertility treatments may be deductible under certain circumstances, but costs directly associated with surrogacy arrangements are not covered.

General Considerations

  • Legal and Financial Advice: It’s crucial for intended parents considering surrogacy to seek legal and financial advice specific to their situation and jurisdiction. Tax laws are complex and change frequently, and professional guidance can help navigate potential opportunities for deductions or credits related to medical and fertility expenses.
  • Documentation: For countries that allow deductions for medical expenses, maintaining detailed records and receipts of all surrogacy-related expenses is essential. This includes medical procedures, consultations, and any other costs potentially eligible for tax consideration.