The hospital said they're doing it to protect the mother's health due to complications. So it's more like they're trying to avoid making things even worse.
It is horribly lacking, and that should be fixed, but trying to make sure her baby is delivered safely isn't really reducible to "reducing costs."
It's lacking because they aren't paying for an on-call or easily accessible doctor; or for the staff to be able to respond sufficiently quickly to an emergency where they would be able to see the concern and then get a doctor there quickly.
In both cases, part of the solution is to pay more / have better employees (that you get, in part, by paying more). That's why I argue it's "reducing costs". It's a banal and boring explanation; but, most evil is.
