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Premature Death Associated With Medical Debt in the U.S.

With rising costs in today’s economy, it’s not surprising that medical debt in the U.S. is also on the rise. The 2021 Survey of Income and Program Participation found that medical debt in the U.S. is about $220 billion. Approximately one in 10 adults in the U.S. has medical debt of $250 or more, even though the insured rate is at an all-time high of above 90%.

The prevalence of medical debt in the U.S.

Medical debt is any outstanding amount owed to a healthcare organization for medical care or products. A recent Kaiser Family Foundation (KFF) analysis of government data showed that about 6% of U.S. adults had $1,000 or more in medical debt, and 1% of U.S. adults owed more than $10,000. The prevalence of medical debt in the U.S. varies geographically, with medical debt tending to be the highest in the South: Mississippi, North Carolina, West Virginia, Georgia, and Texas. These areas experience more widespread chronic disease, and many have not expanded Medicaid services. The lowest percentages of those with medical debt occurred in Hawaii and Washington D.C.

Even with the majority of the population insured, medical debt persists.

The largest payers for healthcare in the U.S. are:

  • Private health insurance (28.5%)
  • Medicare (21.2%)
  • Medicaid (17.2%)
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Certain racial and socioeconomic factors impact the prevalence of medical debt, as it disproportionately affects people of color, women, parents, uninsured individuals, and low-income individuals. When evaluating the prevalence of medical debt in different age ranges, those aged 30–49 have the largest share compared to other age groups.

Correlation between medical debt and premature death

Premature deaths are defined as deaths occurring before the average life expectancy. The average life expectancy in the U.S. is currently 75 years. Health agencies such as the Centers for Disease Control and Prevention (CDC) calculate premature deaths as one indicator of population health.

A cross-sectional study by Han et al., "Associations of medical debt with health status, premature death, and mortality in the US." published in March 2024 by JAMA Open Network, examined 2,943 U.S. counties, accounting for 93% of all U.S. counties, to analyze the relationship between consumer credit, self-reported health status, and mortality records. What they found is a link between increased medical debt and increased premature deaths.

After adjusting for county-level sociodemographic characteristics, a 1–percentage point increase in the population with medical debt was associated with 18.3 (95% CI, 16.3–20.2) more physically unhealthy days and 17.9 (95% CI, 16.1–19.8) more mentally unhealthy days in the past 30 days per 1000 people and with 1.12 (95% CI, 1.03–1.21) more years of life lost per 1000 people.

Han et al.

Another study found that unsecured debt increased premature death risk related to hypertension and cardiovascular disease.

This Frontiers’ study by Agnew et al. (2022) showed that “In examining debt as a mediator of physical health disparities, Batomen and colleagues find that individuals with the highest amounts of unsecured debt, such as that from payday lenders, experienced an increased risk of premature death due to hypertension and cardiovascular disease, compared to their counterparts with the lowest amounts of unsecured debt".

In addition to increased premature deaths, the Han et al. study also found that medical debt is associated with worse health status and higher mortality rates. Those with medical debt may be less inclined to follow up with doctor appointments, fill prescriptions, and seek medical care. According to a KFF Survey, one in 7 adults report that a provider has denied them care due to unpaid bills. One in eight adults with health care debt report skipping or delaying care or medications due to cost.

Some healthcare alternatives these indebted adults have turned to include:

  • Home remedies or over-the-counter medicines
  • Postponing needed medical care
  • Skipping a recommended medical test/treatment
  • Not taking medication as prescribed
  • Sourcing medicines from outside the U.S.
  • Taking leftover prescription medication from someone else

Populations most affected by medical debt in the U.S.

Many adults are concerned about receiving a medical bill they cannot afford. About half of U.S. adults report they could not afford an unexpected $500 medical bill. Individuals often incur medical debt through a one-time event like an unplanned hospital stay for an accident. About 72% of adults state that their persistent medical debt resulted from a short-term medical expense. Those with insurance can be liable for deductibles and out-of-pocket costs.

Aside from one-time incidences that contribute to financially disastrous medical debt, those with chronic conditions also suffer disproportionately from medical debt. According to the Centers for Disease Control and Prevention, chronic and mental health conditions account for 90% of the nation’s $4.1 trillion in annual healthcare expenditures. Those struggling with chronic conditions not only typically require more frequent medical care but are also at higher risk of losing employment and income.

The Han et al. study emphasized that medical debt should be considered a social health determinant. Current common social health determinants include factors such as employment, family income, food security, education, access to health care, and health insurance status. The Han study only included medical debt in collections. The implications of this study could be even broader, considering that there can be other types of medical debt, such as borrowing from family/friends, credit cards, loans, or payment plans.

Understanding medical debt consequences

In addition to impacting health, medical debt can significantly impact finances. People may experience difficulties such as decreasing credit scores, depleting life savings, and foregoing essentials to pay medical bills. Healthcare organizations can sell medical debt to a collection agency to recoup some costs. Some states, like New York, no longer allow medical debt to impact credit scores.

The U.S. government recently passed legislation to alleviate some potential sources of medical debt.

The “No Surprises Act” became effective in 2022 and protects people with health insurance from being charged an out-of-network rate. For those without health insurance, healthcare organizations must provide a “good faith estimate” for care at least three business days before the scheduled procedure. The individual may dispute the charges if the amount billed exceeds a $400 difference from the estimate. Unfortunately, the “good faith estimate” does not include emergency care.

The Hospital Pricing Transparency Rule, passed in 2021, mandates hospitals to provide pricing information to the public in a clear, accessible manner. Most hospital pricing can be found on their websites.

Tips for managing health and medical expenses

Managing health and medical expenses can be overwhelming, but these tips may help:

Ask for the cash price

You can ask healthcare providers or facilities for the cash price of a treatment or procedure instead of solely relying on insurance. At times it may be more economical to pay the cash price versus utilizing your health insurance. Dr. Nam Tran, DPM, surgeon shared his own experience as a patient when scheduling an MRI for himself. The cost of the MRI using his wife's insurance would have been $1,800, but after asking for the cash price, he received a quote for $400. However, note that cash payments may not apply to your deductible. Check with your insurance provider.

Consider out-of-pocket health insurance costs

When selecting health insurance, it’s essential to consider the out-of-pocket and deductible costs. These are considered “cost-sharing” portions of the plan. Many people choose a high-deductible plan for lower monthly premiums. Still, they can find themselves in debt if unforeseen emergencies occur. When using your health insurance, opt to stay in-network to maximize cost savings. Electing a health-savings account, HSA, or flexible-spending account, FSA, will allow you to use pre-tax income to pay for the cost-sharing portions of your plan.

Understand your bill

It’s essential to verify what you are paying before you pay for it. Some states offer a Consumer Assistance Program that assists in understanding health insurance and coverage options — the CDC provides an essential checklist of billing items. You will likely see codes on your bill, like CPT or ICD-10, used to determine the pricing based on a fee schedule.

Correcting billing errors

Correct billing errors before making a payment, and document your communications with insurance and/or health facilities in writing. A KFF survey showed that approximately 44% of adults facing healthcare debt state that they haven’t paid a medical bill in full because they suspected an error in billing. Some billing errors to look out for include receiving a bill prior to it being processed by your insurance, duplicate charges on your bill, being charged for something you did not receive, or “upcoding,” increasing the severity of the treatment you received for higher reimbursements. Follow the guidance in this article, "Why Health Claims May be Illegally Denied and What to Do about It," if you need to appeal an insurance claim.

Review itemized bills

Ask for an itemized bill, especially after a hospital stay. The National Patient Advocacy Foundation estimates that approximately half of all medical bills contain errors. Hospitals are required by law to provide itemized bills upon request. When you have the itemized bill, you can more accurately determine any mistakes, such as being charged twice for a supply or medication. You could also compare the itemized billing statement to the prices on the hospital’s website. Hospitals are mandated per the Hospital Price Transparency Rule to provide price transparency in a clear, accessible format for their services and items.

Direct care alternatives

There is a growing movement of healthcare providers and facilities that operate without contracting insurance companies. They are commonly known as direct care providers or concierge medicine where patients pay cash instead of utilizing insurance. They typically charge a fee billed monthly, quarterly or annually, for clinical and laboratory care. Individuals who utilize this type of healthcare typically elect a high deductible insurance plan to pay for emergency care which is not covered.

Recent studies link increased medical debt with increased premature death. Avoiding medical debt in the U.S. can be complicated, but raising awareness about this critical issue is a start toward needed healthcare cost reform.

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