It’s a financial burden that in other countries would be “unfathomable,” say the health care policy experts. Millions of Americans, even many with insurance, are finding themselves with “crippling amounts of medical debt.”  Those are some of the sobering phrases we found in this just-published article from The Atlantic.  It reveals that simply getting sick, becoming injured, or undergoing surgery in the U.S. can bury someone under a mountain of medical bills from which it is often impossible to dig out.

Medical Debt is “Uniquely American”

“Medical debt is a uniquely American phenomenon,” writes The Atlantic, “a burden that would be unfathomable in many other developed countries.” The article cites a survey published this month in the American Journal of Public Health, revealing that medical debts are a major contributing factor in personal bankruptcy – so much so that almost 60 percent of filers said that the burden of medical bills played a significant role. Medical debt was a bigger factor in personal bankruptcy than either home foreclosure or student loans.  According to the survey cited above, the Consumer Financial Protection Bureau says that medical bills accounted for more than half of all unpaid debts sent to collection agencies in 2014 – the most common underlying cause for bills to get sent to collection.

Another article, this one from a website called Health Affairs, reported in 2017 that about one-third of all cancer survivors had gone into debt while being treated for the disease, and more than half of those faced past-due bills of $10,00o or more. “The cost of cancer care in the United States has become a significant social and public health issue,” says the article. “Cancer care costs are rising at two to three times the rate of other health care costs and are projected to continue increasing over the next decade.” The article warns that severe financial pressure can cause patients to stop treatments early or forego them entirely, triggering a downward spiral of worsening health outcomes aggravated by an inability to keep current on regular household bills.

Medical Debt has Many Causes – and it’s Not Going Away

According to the article in The Atlantic, “There are as many reasons for the medical-debt crisis as there are diagnostic codes that rule the medical-billing world.” But the consensus is that, regardless of specific causes, the problem is not going away. Consumer advocates point to a rising uninsured rate since the modifications to the Affordable Care Act. Also, “More people are signing up for cheaper but skimpier health-insurance plans introduced by the Trump administration,” including high-deductible health plans, many of which require patients to pay thousands before insurance kicks in. The article in The American Journal of Public Health accuses Washington policy-makers of “encouraging a migration to bare-bones, short-term insurance policies that leave enrollees largely unprotected,” and it warns that the imposition of Medicaid work requirements and the weakening of rules requiring coverage of preexisting conditions seems likely to swell the ranks of the uninsured even farther.

As reported in The Atlantic, even patients who should qualify for charity care under the laws in some states can find their bills being sent to collection agencies, according to several advocacy groups. In some cases, one patient advocate reported, the collection agencies aren’t even being told by the hospitals that these debts should have been considered as charity cases. “The debt collectors are trying to collect these debts without making charity care available,” she told The Atlantic. “The patient sometimes gets sued, gets a judgment entered against them, without ever having heard of charity care.” In response to this accusation, the American Hospital Association replied that their institutions provided more than $38 billion worth of care to low-income patients in 2017. “Every day, America’s hospitals treat patients who can make only minimal payment, or no payment at all,” they said in a statement. That may be true, but it’s small comfort if you’re one of the tens of thousands each year getting stuck with the bill.

Medical Debt: the Best Strategy Involves Sound Planning

The article in The Atlantic offers a few recommendations. “To negotiate with a hospital, consumer advocates…recommended asking about financial assistance, including charity care for the uninsured,” says the article. If that fails, patients can try asking the hospital if they can be charged the same amount that someone on Medicare would have paid, which is usually less. You may also find that hospitals, and even some collection agencies, will agree to payment plans or will be willing to lower your bill in exchange for a lump-sum payment. But even if these steps alleviate some of the pressure, the underlying problem remains. “The current system requires people to independently negotiate on their own behalf with giant corporations over tens of thousands of dollars, often while recovering from a major illness,” says The Atlantic. “For those who haven’t done it before, the process can be confounding.”

It’s hard for us at AgingOptions to fathom how, here in the richest nation in the world, we’ve created a health care system that is staggeringly expensive, complex and inequitable. While we would love to think that our political “leaders” would actually come up with a better plan that affordably meets the needs of most Americans, that sort of wishful thinking seems more far-fetched then ever these days – so the take-away for you and me is to be prepared with a thorough and comprehensive plan of our own to cover both short-term and long-term medical needs in retirement. We can assist you with that process through a strategy we call LifePlanning. But the real beauty of a LifePlan is that it is far more than a medical plan or a financial plan: a LifePlan takes those critical elements and weaves them together with a protective legal framework, a strategy to plan where and how you want to live, and a proactive approach to involving your family in your aging plans. It truly is a plan for the rest of your life.

We hope you’ll accept Rajiv Nagaich’s invitation to find out more at a future LifePlanning Seminar. These entertaining, informative events are held throughout the area, and attendance is absolutely free. Bring your spouse, your parents, your adult children, and get your retirement questions answered. For dates, times and locations, visit our Live Events page and register for the event of your choice. Be prepared for whatever retirement living throws your way, with a LifePlan from AgingOptions. And age on!

(originally reported at www.theatlantic.com)