Nearly 56 million adults in the U.S. struggle with medical bills. And health-care bill related woes aren't just reserved for the uninsured; they continue to affect the 10 million INSURED adults who have accumulated debts associated with copays, deductibles, and other out of pocket expenses. With that information, it's no wonder that medical bills are the leading cause of bankruptcy in America, as shown in recent findings by a division of NerdWallet - a price comparison site.
"A lot of Americans are struggling with medical bills," said NerdWallet Health Vice President Christina LaMontagne. This type of analysis which looks at rising health costs is a first for NerdWallet. According to LaMontagne, "With an average American family bringing home $50,000 in income, a high medical bill and a high-deductible insurance plan can quickly become something they are unable to pay," he said. "If you have an out-of-pocket maximum of $5,000 or $10,000, that's really tough."
While many people assume that bankruptcies arise from poor money management such as credit card debt and overspending, it appears medical bills are the root cause. If not careful, health-related costs can actual create a credit card debt cycle in an otherwise financially healthy individual; this is due to credit cards being used to cover out of control medical expenses. In fact, more than 10 million average Americans will lose control of their finances because of medical related credit card debt. NerdWallet also found that 15 million people will resort to depleting their savings accounts in order to handle medical expenses.
People are being pushed to the point of bankruptcy after having to deplete their savings accounts and take on high-interest credit cards in order to ease the burden of health-related costs. Healthy people aren't immune from the issue either. According to the Centers for Disease Control and Prevention (CDC), 83.6% of adults, and 93% of children, have had contact with a healthcare professional in the past year. These percentages mean the majority of U.S. citizens are seeking some form of medical care.
While exercise and a healthy diet may prevent chronic illness, most people will fall ill despite good habits, and many will suffer from accident-related medical problems. Included in the Top 10 Reasons a patient may visit a primary care physician are things like injury, mental illness, and respiratory infections which can affect anyone in the U.S. regardless of the status of personal finances.
Overall, while medical insurance can help Americans ease the burden of inevitable health-related costs, there needs to be an all-inclusive alternative solution if people are to avoid bankruptcies caused by medical bills. For more information on how to take charge of your personal finances, and for classes on financial wellness, please contact the nonprofit organization Catalyst Academy.