By Noam N. Levey -
KHN
Elizabeth Woodruff had to use her retirement savings and look for three jobs after a New York hospital sued her and her husband for nearly $10,000.
There, an infected leg had been amputated.
Ariane Buck, a young father from Arizona who sells health insurance,
was unable to make an appointment with his doctor because of a serious intestinal infection after being told by the office that he had outstanding bills.
Allyson Ward and her husband maxed out credit cards, borrowed from relatives and fell behind on their student loans after the premature birth of their twins left them $80,000 in debt Ward, a nurse, was forced to work extra shifts, working day and night.
"I wanted to be a mother," she said.
"But we had to have money."
Marcus and Allyson Ward, from Chicago, moved across the country to be closer to family after the premature birth of their twins, Milo and Theo, left them with approximately $80,000 in medical debt.
Taylor Glascock
These people are among the more than 100 million Americans—including 41% of adults—beset by a health system that systematically indebts patients on a massive scale, research by Kaiser Health News (KHN) and the National Public Radio (NPR).
The investigation reveals a problem that, despite new attention from the White House and Congress, is far more widespread than previously reported.
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This is because much of the debt that patients accumulate appears as credit card balances, family loans, or payment plans to hospitals and other medical providers.
To estimate the true extent and burden of this debt, the KHN and NPR investigation relied on a national survey conducted by the Kaiser Family Foundation (KFF) for this project.
The survey was designed to capture not only bills that patients were unable to pay, but also other loans used to pay for health care.
The project also draws on new analysis by the Urban Institute and other partners.
The outlook is bleak.
In the past five years, more than half of American adults say they have gone into debt because of medical or dental bills, according to the KFF survey.
Elizabeth and Nick Woodruff of Binghamton, New York, were sued for nearly $10,000 by the hospital where Nick's infected leg was amputated.Heather Ainsworth
A quarter of adults with healthcare debt owe more than $5,000.
And about one in five with a debt said they never expected to pay it off.
“Debt is no longer just a bug in our system.
It's one of their main products,” said Dr. Rishi Manchanda, who has worked with low-income patients in California for more than a decade and has served on the board of the nonprofit RIP Medical Debt.
"We have a health system almost perfectly designed to create debt," he added.
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This burden causes families to cut back on food and other essentials.
Millions of people are forced to leave their homes or file for bankruptcy, according to the survey.
Medical debt causes additional hardship for people with cancer and other chronic illnesses.
Debt levels in America's counties with the highest rates of disease can be three to four times higher than those in the healthiest counties, according to an analysis by the Urban Institute.
Debt also widens racial disparities.
And it's preventing Americans from saving for retirement, investing in their children's education, or laying traditional foundations for a secure future, like borrowing for college or buying a home.
According to the KFF survey, health care debt is nearly twice as common among adults under 30 as it is among those over 65.
Perhaps most perversely, debt prevents patients from receiving medical care.
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About one in seven people with debt said they had been denied access to a hospital, doctor or other provider because of unpaid bills, according to the survey.
An even higher proportion — about two-thirds — have put off care they or a family member needs because of cost.
"It's outrageous," said Dr. Miriam Atkins, a Georgia oncologist who, like many doctors, said she
has had patients forgo treatment out of fear of debt.
Patient debt is piling up despite the landmark 2010 Affordable Care Act (ACA).
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ACA expanded insurance coverage to tens of millions of Americans;
But it hasn't stopped the rise of high-deductible health plans that leave patients with thousands of dollars in bills.
Now hospitals and other medical providers put millions of people in the hands of credit cards and other loans.
Patient debts also support a shadowy collections business fueled by hospitals that sell the debt to collection companies.
America's debt crisis stems from a simple reality: Half of American adults don't have the money to cover an unexpected $500 medical bill, according to the KFF survey.
Many simply do not pay.
Medical debt has become the most common form of debt on consumer credit records.
But research from KHN and NPR shows that medical debt on credit reports represents only a fraction of the money Americans owe for health care.
About 50 million adults — about 1 in 5 — pay bills for their own care, or that of a family member, through a payment plan with a hospital or other provider, according to the KFF survey.
These debt agreements do not appear on credit reports unless the patient defaults.
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One in 10 owes money to a friend or family member who covered their medical or dental bills;
another form of loan that is not usually measured.
Still more debt ends up on credit cards as patients load up their bills and build up balances, generating high interest rates on top of what they owe for care.
About 1 in 6 adults is paying a medical or dental bill that they charged to a card.
For many Americans, medical or dental debt can be relatively low.
About a third owe less than $1,000, according to the KFF survey.
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But health debt can also be catastrophic.
Sherrie Foy, 63, and her husband, Michael, saw their carefully planned retirement cut short when Foy's colon had to be removed.
Sherrie Foy, of Moneta, Virginia, saw her retirement plans shattered when surgery to remove her colon left her with about $850,000 in bills, forcing her and her husband, Michael, to file for bankruptcy.
Carlos Bernate For Kaiser Health
After Michael retired from Consolidated Edison in New York, the couple moved to rural Southwest Virginia.
Sherrie had space there to take care of her rescued horses.
The couple had saved up and had retiree health insurance.
But Sherrie's surgery resulted in medical bills that exceeded the couple's health plan's million-dollar limit.
When Foy couldn't pay the more than $775,000 he owed to the University of Virginia Health System, the couple filed for bankruptcy.
The Foys cashed in a life insurance policy to pay for a bankruptcy attorney and liquidated savings accounts the couple had set up for their grandchildren.
"Everything we had was taken from us," Foy said.
"Now we have nothing."
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About one in eight Americans indebted for medical bills owes $10,000 or more, according to the KFF survey.
Americans have been hit especially hard by the rise of high-deductible health plans, which require them to pay thousands of dollars out of pocket before coverage kicks in.
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Even Medicare coverage can leave patients with drug and treatment costs of thousands of dollars, according to studies.
About a third of seniors have owed money for medical care, according to the survey.
And 37% said they or someone in their household has been forced to cut back on food, clothing and other necessities.
The rising cost of debt has sparked new interest from politicians, including
the White House, which in April announced new initiatives to pressure debt collectors
and track financial aid to hospitals.
However, the changes are unlikely to address the root causes of this national crisis.
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"The number one reason, and the number two, three and four reasons, why people go into medical debt is that they don't have money," said Alan Cohen, co-founder of insurer Centivo, who has worked in the field of health benefits for decades.
Buck, the Arizona father who was denied care, has seen it firsthand selling Medicare plans to seniors.
"I've had older people cry on the phone with me," he said.
"It's horrifying".
Now 30, Buck has recovered from the intestinal infection;
but after being forced to go to a hospital emergency room, he was saddled with thousands of dollars in medical bills.
Today the Bucks, who have three children, estimate they owe more than $50,000.
"We've had to cut back on everything," Buck said.
His children wear used clothes.
They skimp on school supplies and rely on family for Christmas gifts.
“I feel like I have failed as a father.”
The couple is preparing to file for bankruptcy.
KHN (Kaiser Health News) is the newsroom of KFF (Kaiser Family Foundation), which produces in-depth health journalism. It is one of three major programs of KFF, a nonprofit organization that analyzes the nation's health and public health issues.