ST. LOUIS — A statewide philanthropic foundation dove deep into the lives of Missourians with medical debt and released a report Tuesday detailing the devastating impact of mounting medical bills.
Medical debt is causing severe financial hardship and stress, with people having to take on multiple jobs, move, postpone retirement or deplete their savings, according the report, .
Some were forced to delay necessary medical care in order to avoid accruing additional debt. The debt also damaged their credit scores, which was affecting their ability to secure housing, a car or a job.
“This report shines a light on the human cost of a broken health care system,†said Sheldon Weisgrau, vice president of health policy at Missouri Foundation for Health.
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The in December interviewed 42 Missourians with medical debt ranging from less than $500 to $10,000 or more. The individuals were divided into eight focus groups that were either low-income (250% or less of federal poverty guidelines), rural, mentally or physically disabled, or Spanish-speaking.
Their debt resulted from both anticipated and unforeseen health events — such as the accumulating costs of managing a chronic condition, or the unexpected expenses that end up only partially covered by insurance or not covered at all.
“Key contributors to their financial strain included expenses for ambulance services, hospital admissions and long-term stays, diagnostic laboratory tests, deductibles, and procedures not fully covered by their insurance,†the report stated. “Many participants have been managing their debt for several years.â€
Participants also pointed to incorrect billing codes that changed the price, the inability to get an accurate cost estimate of care, confusing bills from multiple companies and unexpected bills coming months after a service.
People not only struggled to pay their regular monthly bills because of debt, but also experienced serious impacts on their well-being. They described relentless stress, aggressive debt collection practices and the shame from having to seek assistance from friends and family.
Some shared that they had to forgo other needed care to avoid accruing additional debt, while others said they were coerced into settling debts before receiving essential treatment or being denied the care altogether.
“Missourians are struggling to afford basic necessities because of medical debt, and it’s having damaging effects on their physical and mental health,†Weisgrau said.
by shows that despite 90% of the United States population having some form of health insurance, medical debt is pervasive, often because of high deductibles and cost-sharing requirements.
Data shows 20 million people (nearly 1 in 12 adults) have over $250 in medical debt. Most of them — about 14 million — owe over $1,000 in medical bills; and about 3 million owe more than $10,000.
The percentage of adults with medical debt varies across states. Hawaii (2.3%) and Washington, D.C. (2.7%) have the lowest, while South Dakota (17.7%) and Mississippi (15.2%) have the highest.
Missouri falls in the middle with 10.6% — about 500,000 Missourians — reporting having medical debt between 2019 and 2021.
KFF polling showed that people with medical debt cut spending on necessities like food, spend their savings, borrow many from friends or family or take on additional debts.
Samantha Schrage Bunk, health policy strategist at Missouri Foundation for Health, said the statewide report underscores an urgent need to address the harmful effects of medical debt.
“By amplifying the voices of those directly impacted, this report provides critical insights that can inform policy reforms so everyone can get the care they need without falling into debt,†Bunk said.
Participants recommended policy interventions such as streamlining health care costs, improving transparency in pricing, expanding financial assistance programs and improving insurance coverage to reduce out-of-pocket expenses. They also suggested targeted support programs for those struggling with financial loss because of a disability or unemployment.
The U.S. Consumer Financial Protection Bureau, created in 2010 to mainly police mortgage brokers and banks, has recently turned its attention to hospitals, nursing homes and medical debt collectors.
The watchdog agency is to be released later this year that would bar medical debt from consumer credit reports.
Researchers at CFPB say that unpaid medical bills are the most common form of debt listed on credit reports, but a poor predictor of whether someone will pay off other bills and loans. that medical debts on credit reports are often riddled with errors.
Officials at the Missouri Foundation for Health say they are planning a statewide survey to learn more about the impact of medical debt and what policies are needed to help Missourians.