Seeing Red: Americans Driven into Debt by Medical Bills
By Michelle M. Doty, Jennifer N. Edwards, and Alyssa L. Holmgren
The Commonwealth Fund
August 2005
ABSTRACT: New analysis of the 2003 Commonwealth Fund Biennial Health Insurance Survey reveals that an estimated 77 million Americans age 19 and older – nearly two of five (37%) adults – have difficulty paying medical bills, have accrued medical debt, or both. Working-age adults incur significantly higher rates of medical bill and debt problems than adults 65 and older, with rates highest among the uninsured. Even working-age adults who are continually insured have problems paying their medical bills and have medical debt. Unpaid medical bills and medical debt can limit access to health care: two-thirds of people with a medical bill or debt problem went without needed care because of cost – nearly three times the rate of those without these financial problems.
http://www.cmwf.org/usr_doc/Medical_bills_FINAL.pdf
And…
Weighing your health plan choices
Consumer Reports
September 2005
Billing remains a pain for PPO members. Among those who contacted their health plan (56 percent of HMO members and 58 percent of PPO members), 63 percent in PPOs said they had to contact their plan about bill or claim status… And PPO enrollees experienced more difficulties with customer support, complaining that they had to phone or write the plan repeatedly and that solving the problem took an unreasonable amount of time.
Comment: The Commonwealth Fund report adds to the plethora of health policy studies confirming that: (1) ameliorating medical debt has become a major health policy challenge, (2) medical debt impairs access to care, and (3) even continuous coverage with private insurance is failing to provide adequate protection against medical debt with the resultant adverse impact on health care access. Though there is nothing really new here, there are a couple of other points worth considering.
Although Medicare covers only about one-half of costs for those over 65 with their greater health care needs, it has done a better job of protecting against medical debt than the fragmented system for those under 65. Though some protection for the retired is afforded by pension funds, the much larger incomes of the workforce are not adequate to compensate for the deficiencies of private coverage. Obviously a universal Medicare program with expanded benefits would be much more effective in preventing medical debt.
Although private insurers are failing miserably in their function of preventing medical debt, some argue that they still serve a purpose in providing administrative functions such as claims processing. The very high costs of health care administration have been well documented. And what are we getting for this? Nearly two-thirds of PPO patients experience unsatisfactory administrative support for claims processing!
We pay an exorbitant amount to insurers but are receiving only inadequate reduction of risk exposure and incompetent administrative services. Why do we continue to nurture the private insurance industry at the cost of the patients who do need care?