Study: Most Personal Bankruptcies Caused By Medical Bills, Illness
By DIANE LEVICK
The Hartford Courant
June 4, 2009
Medical bills or illness contributed to more than 62 percent of personal bankruptcies in 2007, a new study says, showing a nearly 50 percent increase from 2001 and not even reflecting the growing number of people who are losing their jobs and insurance in the recession.
The national study by researchers at Harvard University and Ohio University follows their five-state 2005 study that found medical problems contributed to at least 46.2 percent of bankruptcies in 2001. When identical definitions are applied, the share of bankruptcies involving medical issues has risen 49.6 percent since then.
“The U.S. health care financing system is broken, and not only for the poor and uninsured,” said the new report, which will appear in the August issue of the American Journal of Medicine and online today. “Middle class families frequently collapse under the strain of a health care system that treats physical wounds, but often inflicts fiscal ones.”
Medical bankruptcies will total an estimated 866,000 this year and involve 2.3 million Americans, based on the current bankruptcy filing rate, the report says.
Most medically bankrupt families were middle class. About 60 percent attended college and more than 66 percent owned a home.
Out-of-pocket medical expenses averaged $17,943 for medically bankrupt families — $26,971 for uninsured patients and $17,749 for those who had private insurance — at least initially. Some lose coverage when they became too sick to work, the report says.
The researchers voiced disdain for private insurance and support for a single-payer national health insurance system.
“Private health insurance is a defective product, akin to an umbrella that melts in the rain,” said lead author Dr. David Himmelstein, associate professor of medicine at Harvard. “Unless you’re Warren Buffett, your family is just one serious illness away from bankruptcy.”
The study surveyed a random national sample of 2,314 bankruptcy filers in 2007, examined their court records, and interviewed 1,032 of them.
The research was done by researchers at Harvard Law School, Harvard Medical School and Ohio University, and supported by a grant from the Robert Wood Johnson Foundation.
http://www.courant.com/business/hc-bankruptcies-medical-bills-study-0604,0,6923001.story