60% of Bankruptcies are Caused by Medical Issues

An argument for health care reform:

Medical bills are involved in more than 60 percent of U.S. personal bankruptcies, an increase of 50 percent in just six years, U.S. researchers reported on Thursday.

More than 75 percent of these bankrupt families had health insurance but still were overwhelmed by their medical debts, the team at Harvard Law School, Harvard Medical School and Ohio University reported in the American Journal of Medicine.

“Using a conservative definition, 62.1 percent of all bankruptcies in 2007 were medical; 92 percent of these medical debtors had medical debts over $5,000, or 10 percent of pretax family income,” the researchers wrote.

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13 Responses to “60% of Bankruptcies are Caused by Medical Issues”


  1. 1 Wen-Li Chan June 13, 2009 at 7:10 PM

    I’m not suprised to learn these figures. It costed me almost $100 just to have my wisdom tooth pulled with health insurance. I came from a place where there is national health care — Taiwan. I never paid more than $50 for any medical procedure. I hope President Obama would keep his promise to reform the health care system, so everybody in this country can afford health insurance and nobody have to die because he/she couldn’t afford to go to the hospital.

  2. 2 Amanda Smith June 15, 2009 at 12:38 PM

    It doesnt surprise me to hear this. I know a lot of it has to do with how much it costs to go see a doctor in the first place (which is rediculous by the way), but many other issues also affect this result. One being that not everybody has health insurance, for whatever reason. So when they get into a car accident or need to get a tooth pulled or whatever, they need medical attention regardless of whether they have insurance or not. That fact alone can put them in major debt.
    Another problem we Americans have is the fact that we go see a doctor for every little thing that is wrong with us. A cold is a cold! There is no need to make a doctors appointment to have them tell you what I could have told you. We have been scared into believing that everything is bad for us. So when we get a headache, we think we have a brain tumor. This way of thinking causes us to use up our insurance and money on very minor things.

  3. 3 David Perez June 16, 2009 at 8:27 PM

    I think what we are seeing here is a reliance on too much medicine, and not our common sense. We burden ourselves with unnecessary medical bills and then complain to “the Man”. Sure, people will get hurt and be sick, but does every symptom or injury require outside medical attention? Most problems can be solved with good old fasioned home remedies, instead of the expensive presciption medications. On the contrary, these insurance companies are fair game in a capitalistic society. There is nothing wrong with competition, and if you don’t want to pay more than expected, watch what you do.
    The fact of the matter is that we often blame others instead of ourselves for unwanted consequences. So next time your feeling a little sick, rest and don’t go straight to the doctors. You maybe might feel a little better, and save some money.

  4. 4 Jessica Tsai June 21, 2009 at 1:42 AM

    The issue of healthcare insurance rises every 15-20 years in America and has yet to see any drastic improvement. Over 47 million Americans still lack health insurance and under the new administration, there has been much debate as to what type reform may reduce the problem. Furthermore, the fear of “socialized medicine” and bureaucracy affecting the system undermines progress. Recently, my mother came down with a severe case of the stomach flu and experienced much internal conflict regarding whether or not to seek medical care since our family had just switched health insurance plans and a trip to the hospital would cost us double of what we used to pay. Worried by the onset of the swine flu and unsure of what her illness was, our family made a trip to the ER and ended up paying ~$400 for less than 30 minutes of medical attention. Nevertheless, we are thankful enough to be able to pay for medical bills and it is not surprising that many Americans are unable to afford these expenses, especially in today’s economic crisis. Moreover, as seen in the movie Sicko, Americans on average pay more for healthcare, are in poorer conditions, and have a shorter lifespan than individuals living in countries with national health insurance plans such as France or England. It will be interesting to see within the near future what steps prominent individuals such as Max Baucus along with the new administration will implement in the hopes of increasing healthcare coverage to the majority of Americans. And more importantly, whether or not the details of this new healthcare insurance system will actually be an improvement of what we have today.

  5. 5 Jessie Maguire June 27, 2009 at 6:04 PM

    Working as a physical therapy aide I see a lot of patients that do not have sufficient health insurance in the areas that they need it most. I feel that in areas such as physical therapy people should be given more money because it is such a needed thing. On the other hand I feel that people are missusing what they have to begin with. We do not need to go see the doctor every time we get a cold and we could certainly cut down on the amount of plastic surguries in the United States. The fact of the matter is that nothing is going to resolve this matter quickly. Some may say that sociallized medical care is better, but the reality is that it has problems of its own. There is no miracle pill for the healthcare system.

  6. 6 Tanisha/ Econ 100 July 9, 2009 at 12:35 PM

    I believe it! That 60% of bankruptsies are due to medical issues. Even with insurance, I have medical bills that are put of this world, and that’s on top of bills that I already need to pay. There are hardship applications out there, but thats only IF you’re approved. So, it’s really hard. We need help. Other than that, why not file bankruptcy?… You’re already in too deep. Your credit is already messed up. Why not have everything paid for so you can start all over…?

  7. 7 Kit t Kat July 9, 2009 at 6:06 PM

    This seems likely. I know of people who have health insurance, but also have unpaid bills on their creit due to medical procedures even though they had health insurance. Unfortuntly they are very young and have already poor credit and an expensive bill. On the other hand, I know people also who do not even go the doctor because it costs a lot even though they have health insurance.

  8. 8 Shannon Lackey July 10, 2009 at 9:45 AM

    This fact does not surprise me in the least. Medical cost are outrageous even with health care, last month an emergency visit to the hospital cost me 100 dollars with insurance and a crown on a chipped tooth with insurace was around 500 dollars. Both situations were non cosmetic and both were in need and the money spent was defineltly a damper on a money tight college student. Since health care is not free, most people aquire it through jobs and wiht a loss of jobs come a loss of insurace. I could only imagine how far in debt I would be if I did not have any insurance the last couple of months. Familys in need without health care are at great risk seeing that one trip to the hospital without insurance is thousands and thousands of dollars. My family that lives out of the country find it hard to travel here as well because of out nations madical policies, so on top of the expensive travel, travel medical insurance must also be purchased which is another pricey traveling expense. This problem should be resolved I think everyone in the country deserves medical care. If almost all the other countries can do it, we should be able to too.

  9. 9 Abby August 4, 2009 at 10:47 AM

    Medical care is undeniably expensive. Sometimes these costs are unavoidable, like in accidents or unpreventable diseases, but the majority of medical spending goes towards treating preventable conditions from lifestyle choices such as smoking, obesity, etc. There are countless life-threatening health risks posed by either, and both result in avoidable health care costs for the individual and taxpayers.

    Let’s examine obesity from an economic standpoint: Obesity can be classified as a national epidemic (more than 30 states have obesity rates >30%), and “the prevalence of obesity rose 37% between 1998 and 2006, and medical costs climbed to about 9.1% of all U.S. medical costs.” The medical costs associated with treating obesity-related diseases were more than $147 billion in 2008, and obese people spent 42% more than people of normal weight on medical costs in 2006. The numbers here are appalling; overall medical costs have skyrocketed because of America’s obesity epidemic.

    Medical debt and lack of insurance is always unfortunate, but how often is it caused by medical conditions that could have been avoided? With better lifestyle choices and perhaps more government spending on health education (rather than inefficient public health care), inevitably many of these families would not be in bankruptcy.

    statistics from: http://online.wsj.com/article/SB10001424052970204563304574314794089897258.html

  10. 10 wongt August 5, 2009 at 10:02 AM

    I am not at all surprised by these figures. I can name six people off the top of my head that are near bankruptcy or have declared bankruptcy due to medical bills that piled up. Its so ridiculous how much medical services are that they still hurt the pocket even though one has health insurance. Can you imagine what it does to those who do not have health insurance?

  11. 11 E. Speizer August 6, 2009 at 2:53 PM

    It’s certainly time for health care reform. I have no idea how we’ll do it, but we need to figure out a health care system that won’t destroy people’s finances. I had a simple shoulder operation back in 2006, and I’m lucky to have health insurance, because the surgery along with the hospital stay would have set my family back thousands and thousands of dollars. Especially in the recession we’re in, people can’t afford to pay for these bogus health care costs.

  12. 12 Maricar De Los Reyes August 6, 2009 at 6:43 PM

    Its not a surprise that a large percentage of debt is from medical bills. Just to get one cavity filled was $125 for me, after using up all my insurance for cleaning, check-up, etc. Health care is important, yet so many people do not have access to this necessity. A lot of the times insurance isn’t a benefit from their job, or its too expensive. Therefore, by the time people finally go in for something, the health problem is huge and the payments are enormous. Coming from the very southern part of Texas (Rio Grande Valley), I’ve seen the health care used and abused. There were definitely extremes on both sides. Some people used Medicaid to their advantage and would abuse it, getting whatever little prescription they could to sell the medicine. Or they used their children, bearing more and more, so they could get all the benefits from the government. I know this because I worked at a Pharmacy where Medicaid was accepted. However, when the recession came around, many people can’t even use what they used to have for real reasons because they do not have access anymore to that health care. It either became too expensive to see a doctor, or their help was completely cut. This then affects all those workers. My mom is a nurse, and she’s been getting canceled 2-3x a week because there aren’t enough patients. She works with very premature babies, and the crazy thing about it is, although there are women giving birth with premature babies, they don’t go to the hospital because it is simply out of their price range.

    I truly hope Obama can make a change for this. A national health care system would be kinda nice.

  13. 13 TTS06 December 17, 2009 at 1:56 PM

    I can see that this could bankrupt so many people I had a 12000 dollar hospital bill this past summer and it was just a small injury and I had money saved up so I suppose a serious injury or a family on the line would be suceptable to financial crisis.


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