Nearly one in 12 U.S. adults are currently burdened with unpaid medical debt, totaling a staggering $220 billion across the nation.
Financial Challenges Across Various States
The analysis of government data by KFF revealed that approximately 14 million Americans, representing six percent of adults, owe more than $1,000 in medical debt, with an additional three million individuals (one percent of adults) facing debts exceeding $10,000. Medical debt encompasses expenses accrued for various health care services, including doctor's appointments, ambulance rides, and surgeries.
Struggles with Insurance Coverage
Despite 92.1 percent of Americans holding private health insurance, most individuals are still required to cover deductibles, coinsurance, and copays for medical treatments and prescriptions. This financial burden can escalate significantly in cases of severe injury or illness, leading to thousands of dollars in out-of-pocket expenses to meet these cost-sharing obligations. Insured individuals may also accumulate medical debt from services not covered by their insurance plans, such as denied claims and out-of-network care.
State Disparities in Medical Debt
The average rate of medical debt among U.S. adults stands at 8.6 percent, but certain states demonstrate significant variations. Hawaii boasts the lowest percentage of medical debt at 2.3 percent, followed by California (3.9 percent) and Oregon (5.2 percent). Conversely, states like South Dakota and Mississippi report higher rates of 17.7 percent and 15.2 percent, respectively.
Demographic Inequalities
Individuals with lower incomes are disproportionately affected by medical debt, with nearly one in 10 adults earning below 400 percent of the federal poverty level carrying such financial obligations. Southern residents exhibit a higher likelihood of health care debt compared to other regions, with 10 percent of adults in southern states grappling with unpaid medical bills.
Progress in Medical Debt Relief Efforts
Some areas are actively addressing the issue of medical debt relief, such as New Jersey and Cook County in Illinois, utilizing funds from the American Rescue Plan Act of 2021. Government intervention to alleviate medical debt is widely supported by Americans, with over half of the population expressing the importance of such initiatives. The need for financial assistance in managing medical debts remains a pressing concern for many individuals nationwide.