Despite promises, medical bankruptcy still as high with the ACA

Mar 2012
56,305
37,872
New Hampshire
#1
A new study shows how the Affordable Care Act (ACA) has failed to solve one of the major crises in the American for-profit health insurance system that it was supposed to help eradicate: bankruptcies related to high medical bills and other healthcare-related costs.

The Consumer Bankruptcy Project (CBP) examined 910 bankruptcies that were filed between 2013 and 2016 and found that, similarly to before the ACA was passed in 2010, 66.5 percent of the bankruptcies were brought about by medical bills families were unable to afford or income loss due to illnesses. About 530,000 American households continue to see their finances wiped out each year due to medical costs, according to the report, which was published in the American Journal of Public Health.

"Unless you're Bill Gates, you're just one serious illness away from bankruptcy," said Dr. David Himmelstein, the study's lead author. "For middle-class Americans, health insurance offers little protection. Most of us have policies with so many loopholes, copayments, and deductibles that illness can put you in the poorhouse. And even the best job-based health insurance often vanishes when prolonged illness causes job loss—just when families need it most."

The report "found no evidence that the ACA reduced the proportion of bankruptcies driven by medical problems: 65.5 percent of debtors cited a medical contributor to their bankruptcy in the period prior to the ACA’s implementation as compared to 67.5 percent in the three years after the law came into effect," PNHP said in a statement.

Despite Promises of ACA, Study Shows Two-Thirds of Personal Bankruptcies Still Caused by Illness and Medical Bills
The American Journal of Public Health (AJPH) from the American Public Health Association (APHA) publications
 
Sep 2017
5,469
6,536
Massachusetts
#2
A new study shows how the Affordable Care Act (ACA) has failed to solve one of the major crises in the American for-profit health insurance system that it was supposed to help eradicate: bankruptcies related to high medical bills and other healthcare-related costs.

The Consumer Bankruptcy Project (CBP) examined 910 bankruptcies that were filed between 2013 and 2016 and found that, similarly to before the ACA was passed in 2010, 66.5 percent of the bankruptcies were brought about by medical bills families were unable to afford or income loss due to illnesses. About 530,000 American households continue to see their finances wiped out each year due to medical costs, according to the report, which was published in the American Journal of Public Health.

"Unless you're Bill Gates, you're just one serious illness away from bankruptcy," said Dr. David Himmelstein, the study's lead author. "For middle-class Americans, health insurance offers little protection. Most of us have policies with so many loopholes, copayments, and deductibles that illness can put you in the poorhouse. And even the best job-based health insurance often vanishes when prolonged illness causes job loss—just when families need it most."

The report "found no evidence that the ACA reduced the proportion of bankruptcies driven by medical problems: 65.5 percent of debtors cited a medical contributor to their bankruptcy in the period prior to the ACA’s implementation as compared to 67.5 percent in the three years after the law came into effect," PNHP said in a statement.

Despite Promises of ACA, Study Shows Two-Thirds of Personal Bankruptcies Still Caused by Illness and Medical Bills
The American Journal of Public Health (AJPH) from the American Public Health Association (APHA) publications
That isn't a very good study if your intent is to find out if ACA has helped to depress medical bankruptcies, since it's not based on a count of medical bankruptcies, but rather a ratio of medical bankruptcies to overall bankruptcies. Obviously, if medical bankruptcies fell, but bankruptcies for other reasons also fell (e.g., because household debt levels shrank significantly in the Obama years), you could wind up with the same ratio even with a big improvement.
 
Likes: Dangermouse
Mar 2012
56,305
37,872
New Hampshire
#3
That isn't a very good study if your intent is to find out if ACA has helped to depress medical bankruptcies, since it's not based on a count of medical bankruptcies, but rather a ratio of medical bankruptcies to overall bankruptcies. Obviously, if medical bankruptcies fell, but bankruptcies for other reasons also fell (e.g., because household debt levels shrank significantly in the Obama years), you could wind up with the same ratio even with a big improvement.
The problem with the ACA was that the insurers still run the show. They set the premiums and deductibles. So a poor persons likelihood of declaring bankruptcy is still the same whether they are 12K in debt or a million dollars in debt. Deductibles were set so high for the bronze plans that its not hard to imagine people going bankrupt if the average American doesnt have $400 in savings.
 
Apr 2015
14,374
2,601
Katmandu
#4
That isn't a very good study if your intent is to find out if ACA has helped to depress medical bankruptcies, since it's not based on a count of medical bankruptcies, but rather a ratio of medical bankruptcies to overall bankruptcies. Obviously, if medical bankruptcies fell, but bankruptcies for other reasons also fell (e.g., because household debt levels shrank significantly in the Obama years), you could wind up with the same ratio even with a big improvement.
A big improvement would lower the ratio of medical bankruptcies, which didn't happen.
 
Mar 2012
56,305
37,872
New Hampshire
#5
A big improvement would lower the ratio of medical bankruptcies, which didn't happen.
Access is a big factor here and one which gets overlooked. Costs rise staggeringly if people use ERs. Yet where else do people go after hours? A fall with a broken bone can cost 25K in an ER. Thats a massive cost factor and one nobody ever addressed. It was somewhat addressed by mandating health insurance but many couldnt get doctors and were put on waiting lists. That meant ER is still the main source of their care. Others that could get doctors, still had to use ERs for overnight urgent care. Its a massive cost and nobody can figure out a solution to it.
 
Apr 2015
14,374
2,601
Katmandu
#6
Access is a big factor here and one which gets overlooked. Costs rise staggeringly if people use ERs. Yet where else do people go after hours? A fall with a broken bone can cost 25K in an ER. Thats a massive cost factor and one nobody ever addressed. It was somewhat addressed by mandating health insurance but many couldnt get doctors and were put on waiting lists. That meant ER is still the main source of their care. Others that could get doctors, still had to use ERs for overnight urgent care. Its a massive cost and nobody can figure out a solution to it.
Yep, ended up the ER Christmas night at 9pm, that was the only option, $3,500 for an IV.
 

HCProf

Moderator
Sep 2014
27,853
17,078
USA
#7
The problem with the ACA was that the insurers still run the show. They set the premiums and deductibles. So a poor persons likelihood of declaring bankruptcy is still the same whether they are 12K in debt or a million dollars in debt. Deductibles were set so high for the bronze plans that its not hard to imagine people going bankrupt if the average American doesnt have $400 in savings.
You should see the increasing numbers of hospital bad debt that is resulting from the deductibles. We have a quarterly meeting at our hospital that I always attend to stay current. Bad debt is always on the list. We have started pre-payment worksheets to provide patients with their out of pocket costs if they have a commercial insurance. We require half up front for elective surgeries that are non-life threatening. We have lost A LOT of commercial insurance patients and it is directly affecting the hospital at this point. You can't imagine the number people we have laid off in the last two years. We geared up for increased census and now that has fallen off and all of those people we hired are pretty much gone now.

Hospital bad debt: 10 trends to know

It is impossible for a average middle class family to pay 1K or more in premiums and then pay out of pocket for their care. This is such a simple one to see and I question the motives behind the development of the ACA. Since the insurance companies have been unchecked and the ACA has so many affordability issues...it is not hard to see how this happened. You posted a thread about Pelosi backing off Medicare for All and working with the insurances...it is not hard to envision her motive for that. She probably has stashed those insurance lobby checks in an account in the Caymens...all on our backs.
 
Likes: bajisima
Mar 2012
56,305
37,872
New Hampshire
#8
You should see the increasing numbers of hospital bad debt that is resulting from the deductibles. We have a quarterly meeting at our hospital that I always attend to stay current. Bad debt is always on the list. We have started pre-payment worksheets to provide patients with their out of pocket costs if they have a commercial insurance. We require half up front for elective surgeries that are non-life threatening. We have lost A LOT of commercial insurance patients and it is directly affecting the hospital at this point. You can't imagine the number people we have laid off in the last two years. We geared up for increased census and now that has fallen off and all of those people we hired are pretty much gone now.

Hospital bad debt: 10 trends to know

It is impossible for a average middle class family to pay 1K or more in premiums and then pay out of pocket for their care. This is such a simple one to see and I question the motives behind the development of the ACA. Since the insurance companies have been unchecked and the ACA has so many affordability issues...it is not hard to see how this happened. You posted a thread about Pelosi backing off Medicare for All and working with the insurances...it is not hard to envision her motive for that. She probably has stashed those insurance lobby checks in an account in the Caymens...all on our backs.
I have long said health insurance and the defense industry are linked. We never have cut defense either even though they all say they want to. Why? Because of lobbyists and jobs. Defense contractors for the most part, have been shrewd in locating themselves in deep blue states creating a lot of jobs. That way their democratic reps will refuse to cut that budget for fear they will have massive job losses. Health insurance is now the same way. The lobbyists and fear of massive job loss is scaring many politicians into changing that dynamic. Its the golden goose.
 
Sep 2017
5,469
6,536
Massachusetts
#10
The problem with the ACA was that the insurers still run the show. They set the premiums and deductibles. So a poor persons likelihood of declaring bankruptcy is still the same whether they are 12K in debt or a million dollars in debt. Deductibles were set so high for the bronze plans that its not hard to imagine people going bankrupt if the average American doesnt have $400 in savings.
Clearly the ACA approach wasn't ideal. It's what you get when you take the Republican approach to healthcare reform as the best that can be achieved. The minute Obama decided that bipartisanship was so important that we'd commit to the Heritage Foundation/Romney goal of preserving corporate profits for the insurers, the magnitude of the improvement was effectively capped. But, has it been an improvement? Hell yes!

As I've mentioned before, we went from falling down the international rankings of life exectancy --for decades-- to rising up them. And the pace of healthcare inflation since Obamacare passed has been the lowest, by a margin, of any period of that length on record. As for bankruptcies, they're down SHARPLY. In the five years culminating in 2010 (the year Obamacare passed), we had an average of 1,149,370 non-business bankruptcy filings per year, and that was rising by an annualized pace of 7.22% per year. Over the next seven years (my data only runs through 2017), even as the population grew, the average number of non-business bankruptcy filings per year fell to 1,004,104, and the annualized pace of DECLINE was 10.4%!

Just the Facts: Consumer Bankruptcy Filings, 2006-2017

Now, granted, that wasn't all due to the huge drop in medical bankruptcies. But, that huge drop did, in fact, play a part. Using the study you cited, where pre-ACA medical bankruptcies made up 67.5% of bankruptcies, that would suggest that back in 2010 we had something like 1,038,172 medical bankruptcies, or 1 per 298 Americans, whereas by 2017 (using the later 65.5% rate from the study you linked to), we had about 502,857, or 1 per every 648 Americans.

Now, stop and really consider those numbers. Picture if I had a time machine and could go back and talk to the 2010 version of yourself, and I told you that if Obamacare passed, the per capita number of medical bankruptcies would drop by well over half in just seven years. You'd have assumed I was lying. There's no way that we could erase over half our medical bankruptcy problem that quickly, much less do so while actually climbing the international rankings for life expectacy.... right?

Yet, isn't that what happened? Isn't it fascinating that, even the face of such a breathtaking success, people are trying to spin it as a failure?
 
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