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One in Five American Families Have Medical Bill Problems

posted by Melissa Jacoby

According to this new report. As Mirya Holman and I have explained in the bankruptcy context, measuring medical bill problems and debt is notoriously contested, but the Center for Studying Health System Change does try to make clear its methods and also uses similar metrics over time. The report also contains statistics on the proportion of their sample that considered filing for bankruptcy and actually did file. Definitely worth reading.  


I scanned the report, but it doesn't really tell me much. It gives the rate at which people say they have medical bill problems, but does not provide any information about the actual size or seriousness of the bills.

Before drawing any conclusions, one should compare this with the number of people who report they have "housing bill problems", "food bill problems", "automobile bill problems", etc.

A quick web search shows 29% having trouble paying the mortgage (http://www.rewealthcoach.com/2011/04/14/harris-poll-shows-29-have-trouble-paying-mortgage/). Another survey gives 20% having trouble paying for food but only 11% housing (http://www.thestreet.com/story/11281505/1/food-shelter-data-worse-than-in-recession.html).

I would guess that roughly one in five families have trouble paying their bills. I'd also guess that this number, while changing a little, is probably fairly constant over time. Some percentage of people will always have trouble paying bills, and some percentage of people will be dealing with large unexpected expenses.

Agreed it is difficult to parse the policy implications when families struggle with a wide range of problems, including income instability. I have talked about this in a paper called The Debtor-Patient Revisited (on SSRN).

Perhaps someone from the Center will want to chime in with more details about methodology.

In a completely nonscientific sampling (my practice), medical costs may be the single biggest reason people walk in my door. Big medical bills are bad enough, but they also frequently indicate a loss of income that nothing in our system makes up for. If there aren't any medical bills, that's frequently because people skipped other bills, including house and car, to pay the doctor because they're desperate to maintain that relationship. And if they debtors ARE really behind, medical bill collectors are among the most aggressive you'll find and the quickest to garnish paychecks.

I agree with Thomas Wicklund that the myopic focus on medical bills may miss the forest for the tree. Most of the respondents said they were having trouble paying all kinds of bills.

There is a survivorship bias in the medical bill area. And I don't mean survival of the patient. Among basic categories of expenditures, medical bills tend to survive longer than others. You can't stiff most other suppliers of basic goods and services - for example,you can't ride the bus without paying - but credit cards and medical bills, particularly emergency rooms, are where you can stretch your payables to conserve cash. So they tend to survive as debts longer than other categories and show up in bankruptcy cases more than other categories do. It isn't really a sign of harshness of medical providers, it's really the opposite. And let's not forget that those who file bankruptcy get relief from their medical debts; it's the providers who lose.

I note that the study implies that medical bills are a modest factor in bankruptcy: 1/5th of all families have problems with medical bills; 1/4 of those consider filing; and 1/5th of that smaller group (5% of the larger group) actually file. So 95% of those with medical bill problems don't file. And to circle back to the first comment, the study doesn't tell you what other problems the filers had.

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