Medical problems contributed to 66.5 percent of all bankruptcies, a figure that is virtually unchanged since before the passage of the Affordable Care Act (ACA), according to a study published as an editorial in the American Journal of Public Health. The findings indicate that 530,000 families suffer bankruptcies each year that are linked to illness or medical bills.
The study, carried out by a team from the Consumer Bankruptcy Project (CBP), surveyed 910 Americans who filed for personal bankruptcy between 2013 and 2016 and abstracted the court records of their bankruptcy filings. The study provides the only national data on medical contributors to bankruptcy since the 2010 passage of the ACA. Bankruptcy debtors reported that medical bills contributed to 58.5 percent of bankruptcies, while illness-related income loss contributed to 44.3 percent; many debtors cited both of these medical issues.
These figures are similar to findings from the CBP’s medical bankruptcy surveys in 2001 and 2007. As in those earlier studies, many debtors cited multiple contributors to their financial woes.
The current study found no evidence that the ACA reduced the proportion of bankruptcies driven by medical problems. The responses also did not differ depending on whether the respondent resided in a state that had accepted ACA’s Medicaid expansion. The researchers noted that bankruptcy is most common among middle-class Americans, who have faced increasing copayments and deductibles in recent years despite the ACA.
Relative to other bankruptcy filers, people who identified a medical contributor were in worse health and were two to three times more likely to skip needed medical care and medications.
“Unless you’re Bill Gates, you’re just one serious illness away from bankruptcy,” said lead author David Himmelstein, MD, a professor at the City University of New York’s Hunter College and lecturer at Harvard Medical School. “For middle-class Americans, health insurance offers little protection. Most of us have policies with so many loopholes, copayments, and deductibles that illness can put you in the poorhouse.”
This article was adapted from information provided by Physicians for a National Health Program.