Earlier this month (July 19), VoxFairfax reported that a Virginia not-for-profit partnered with a New York-based not-for-profit (RIP Medical Debt) to eradicate $278 million owed by Virginians and Tennesseans. The relief covered over 26,000 Commonwealth residents. The project was spearheaded by The Secular Society, a Blacksburg organization that does not solicit donations or apply for grant funds and had donated $3 million to RIP. In turn, RIP purchased outstanding debt for pennies on the dollar; the debt is forgiven, clearing negative marks on credit reports and shielding debtors from further collection activities.
Nationally, however, medical debt is now measured by the headline of this article. Yes, that is $140 billion dollars, the amount of medical debt of unpaid bills held by collection agencies in the United States and estimated to affect 18% of the population. The data reflected research published by the Journal of the American Medical Association (JAMA) in July 2021. The report concluded that the debt is the largest among all debt. And the reported $140 billion is not the total of medical debt because more outstanding medical bills are still held by healthcare providers or those under periodic payment on credit cards or voluntary payment plans. Nor do the data reflect medical expenses arising from the coronavirus pandemic.
In proportion, the charitable effort undertaken in Virginia represents only .002% of the national total. The JAMA data revealed severe distinctions among states that participated in Medicaid expansion and those that have to date declined to participate. For example, Missouri voters approved a statewide referendum to participate but its legislature decided against funding the program. Last week, the state’s highest court found the referendum results to be valid and that the state must comply.
In states that do not participate in Medicaid, the average debt is $375 greater than that in states that participate. Clearly, Medicaid offers both improved healthcare outcomes as well as contributing to financial health long and short term. Detailed data indicated that in lower income ZIP codes, average debt was $671, while in higher income areas it was $126, evidence that medical debt affects the lowest wage earners far more than others.
In states that do not participate in Medicaid, the average debt is $375 greater than that in states that participate. Clearly, Medicaid offers both improved healthcare outcomes as well as contributing to financial health long and short term. Detailed data indicated that in lower income ZIP codes, average debt was $671, while in higher income areas it was $126, evidence that medical debt affects the lowest wage earners far more than others.
The findings support multiple public policy insights about the effects of medical necessity versus other subsistence choices. Researchers observed that, unlike food purchases, medical expenses are not subject to choice. More research needs to be conducted to examine what, if any, effect reduction of medical debt may have upon medical costs. Certainly, millions and billions of uncollected funds incurred by caregivers adds to pricing and costs for services.
Census data published in April 2021 measured the medical debt ratio across the nation by region, with the number of households in the South at 22.1%; 15.2% in the West; 15.6% in the Northeast, and 20.1% in the Midwest. States that have not yet participated in Medicaid expansion further confirm the regional profiles of medical debt ratios. Those states are Wyoming, South Dakota, Texas, Mississippi, Alabama, Georgia, Tennessee, North Carolina, South Carolina, Florida, and Wisconsin. Sadly, political scorecards reflect that these are among jurisdictions that most loudly opposed and even condemned the Affordable Care Act.
The statistical picture is devastatingly clear that national health insurance is a necessity.
The statistical picture is devastatingly clear that national health insurance is a necessity. The JAMA article also provided data that illustrated the effects of Medicaid expansion on medical debt:
- States that did not expand Medicaid at all saw their medical debt grow from about 78% in 2010 to 90% in 2020;
- States that expanded Medicaid after 2014 saw their medical debt drop from about 85% to 75% during that same period; and
- States that expanded Medicaid in 2014 saw their medical debt drop substantially, from about 80% to 55% during that same period.
A $140,000,000,000 index of pain and suffering is an unnecessary cost upon the public.
Categories: coronavirus, Health Care, Issues, legislature, National, State, wealth inequality
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