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Rising Health Costs Force Many Into Bankruptcy

A bankrupt idea is driving many working families into personal bankruptcy.

Shifting ever increasing health care costs to employees is the bankrupt idea. Expenses not covered by inadequate insurance policies were a major factor in half of bankruptcy filings examined in a Harvard University study.

The 1.9 to 2.2  million Americans affected by medical bankruptcy are the tip of the iceberg. The study found that between 8 and 21 percent of American families are contacted by collection agencies about medical bills each year.

Many more families struggle to pay their bills as the health care crisis prevents them from keeping up with inflation.

 Typical Debtor

Personal bankruptcy is clearly a working family issue. "The average debtor was a forty-one-year-old woman with children and at least some college education. Most debtors owned homes; their occupational prestige scores place them predominantly in the middle or working classes," reads "Illness and Injury as Contributors to Bankruptcy," published on the Health Affairs Web site.

Advocates of cost shifting often described excessive use of the system as a reason for increasing costs. Data collected in the Harvard study suggest a different trend. More than half of the bankruptcy filers had gone without needed doctor or dentist visits during previous two years; 43 percent failed to fill prescriptions because of the cost.

 Serious Hardships

In addressing the policy implications of their findings, the researchers wrote:

"The privations suffered by many debtors - going without food, telephone service, electricity and health care - lend credence to claims that coverage was unaffordable and belie the common perception that bankruptcy is an 'easy way out.'"

Imposing new health care costs on the family budgets of working people is clearly a bankrupt idea that does nothing to solve a serious national and state problem.

For interesting commentary on the health care crisis and bankruptcy see:

Debtors' prison
Bankruptcy bill will make debtors indentured servants.   
March 9, 2005 Concord Monitor editorial