Under the changes, midwives must be insured in order to be registered, but private insurers no longer provide cover for homebirthing.
Opponents believe it will drive the practice underground and increase health risks.
Midwives have argued that outlawing homebirths removes a mother's right to choose and will be a step back to the dark ages.
About 2000 women have submitted their names to the senate inquiry, showing the depth of opposition to the issue, Australian Private Midwives Association president Liz Wilkes said.
"We cannot believe that women will be denied the right to choose where they have their baby in a democratic society," she said.
"This seems to be particularly ludicrous given that this is Australia and we are in 2009, not 1909."
Debate on the legislation is scheduled to resume in the House of Representatives this week.
