This tightly focused, neatly formed story about adults facing relatively common but still profoundly challenging ethical problems is precisely the kind of movie that used to get made with a moderate amount of money and then went on to win awards. Think Ordinary People or Kramer vs Kramer. Nowadays, it’s something only film-makers willing to take risks will tackle, but maybe the results are all the better for it.

The core of the story is a decision facing a trio in their late 20s/early 30s who have compacted to form a new kind of family. Jess (Jasmine Batchelor, terrific at projecting a very millennial blend of intelligence and idealism) is a web designer for a non-profit who’s not ready to settle down with any lover, although there’s a guy she hooks up with occasionally. Instead, her most intense emotional relationship is with Josh (Chris Perfetti), her best friend ever since they went to Sarah Lawrence together, and his husband Aaron (Sullivan Jones). Jess has agreed to be their surrogate and have a baby for them, on the understanding that they won’t pay her directly for this act of generosity or expect her to co-parent the child, but they will pay all her expenses.

The exact nature of their gentlepeople’s agreement becomes much more relevant when one contingency they seemingly hadn’t planned for emerges: a prenatal test at 10 weeks shows the baby is 99% likely to have Down’s syndrome. Suddenly, the two men aren’t quite so keen to keep the baby, while for Jess, the more she learns about parenting kids with DS, the more she starts to wonder if she wouldn’t like to go ahead with the pregnancy and have the baby on her own. The film’s last half hour is basically a series of superbly performed and unfussily filmed showdowns … between Jess and her parents, Jess with Josh and Aaron, even Jess trying to get the exhausted mother of a child with DS (Brooke Bloom) to help her work out what she should do.

Writer-director Jeremy Hersh, making his feature debut, excels at unpicking how the threads of each character’s moral position are tangled up with other issues, such as class, gender, sexuality, privilege and even race (Jess and Aaron are Black; Josh is white) that have real material effects on how they see the dilemma. No one is a bad guy here, while all of them are also flawed, and the movie keeps the viewer wondering right up to the end what Jess will finally decide.

• The Surrogate is released on 9 July in cinemas.