Healthcare Reform Leaves Widespread Medical Debt Largely Untouched
The Affordable Care Act has expanded coverage to more than 10 million Americans who were previously without health insurance, and provided subsidies to millions more. But it hasn’t changed much for those who have fallen behind in paying for health care.
At the Yakima County courthouse, Presiding District Court Judge Kevin Roy walks past a rattling dot-matrix printer and long rows of color-coded folders to a shelf of files awaiting his signature. “If I was to pull one of these files," Judge Roy says, taking one from the shelf, “Yep, Memorial Physicians, PLLC. That’s not by luck.”
Not by luck, because most of these files are for medical debt. The Affordable Care Act has expanded coverage to more than 10 million Americans who were previously without health insurance, and provided subsidies to millions more. But it hasn’t changed much for those who have fallen behind in paying for healthcare.
Judge Roy spends a big chunk of his workday signing judgments against people who owe money to hospitals and medical providers. “It’s like the tide coming in every week, he says.
Medical debt affects one of every four Americans, and accounts for more than half of all bankruptcies. At age 60, Scott Cliett says he’s in debt for the first time in his life. Cliett got free health coverage through Obamacare for the first time since he lost his accounting job during the recession.
But he’s still struggling to pay off debt from an emergency room visit before he got Obamacare. When he missed a $25 installment after making monthly payments on-time for more than two years, Cliett wound up in court.
“The Judge did allow me to speak, but the fact that I admitted I do owe them money pretty much cut everything else off,” Cliett says, reflecting on his day in court. “‘You know, I’m sympathetic to your plight, but I have to follow the letter of the law: you owe them money so therefore I’m granting the judgment.’”
For the past five years, chronic pancreatitis has regularly sent Cliett to the hospital for a week at a time, with a tab in the tens of thousands of dollars. When he was uninsured, most of this was forgiven by the local hospital’s charity care program.
But since Cliett’s health keeps him from working consistently, he’s barely made a dent paying off the remainder, things like a $4000 ambulance ride. “Let’s see, $4000 divided by twenty five dollars,” he says. “My grandkids will probably be paying this off when I’m gone.”
Overall, gaps in coverage like Cliett’s are the exception to the rule. The vast majority of people with medical debt have insurance the whole time those costs are piling up. But the bills insurance doesn’t cover can be devastating on their own.
That’s one reason Dr. Steffie Woolhandler, who teaches health policy at City University of New York, says health insurance is often a ‘defective product.’
“People buy it in good faith to try and get medical care and make sure their bills are paid, and then when they get an expensive or prolonged illness, it doesn’t work,” she says.
Woolhandler says Obamacare has definitely helped. But “underinsurance”--when a policy has high out-of-pocket costs--is still far too common.
Copyright 2015 Northwest News Network