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Unexpected health emergencies can occur at any time and often come at a cost so high it straps you with medical debt. You need to prioritize your health but also can't handle the financial strain of your medical bills. What's the proper solution?
Health insurance aims to prevent healthcare debt by lowering the cost of treatment and services. With the right healthcare plan, you can see the doctors you need without worrying about the high cost of appointments and treatments. Discover how health insurance policies are key for managing medical bills and steps you can take to experience relief from your medical costs.
Did you know that 41% of Americans carry some form of medical debt? According to a study from KFF Health News, more than 100 million Americans are struggling to pay back their healthcare costs, which can come in the form of:
That same study finds that healthcare debt can be widespread regardless of a person's race, ethnicity, or age. Up to 55% of adults aged 18 to 29 carry some amount of debt. The 30 to 49 age group is most susceptible to medical debt, as it affects 69% of the population, while up to 60% for people between the ages of 50 and 64 have medical debt.
Similar figures depict the number of people in debt according to race and ethnicity. Up to 54% of white adults carry some amount of debt, while Hispanic and Black adults experience healthcare debt at 64% and 69%, respectively.
According to the study, 68% of people with an annual household income below $40,000 carry some form of medical debt compared to the 45% who have an income greater than $90,000. Up to 71% of Americans without health insurance can expect to carry healthcare debt.
The majority of people dealing with healthcare debt don't owe tens of thousands of dollars. In fact, a study from the Commonwealth Fund finds that over half of individuals in debt owe less than $2,500. However, even a minuscule amount of debt can lead to a string of financial difficulties.
You may find yourself spending less on food for your family or scrambling to pick up extra hours at work. More extreme measures include failing to pay off monthly loans or credit card statements. Some people have no other option but to file for bankruptcy as a result of their healthcare debt.
Carrying medical debt can have long-lasting consequences until you pay it off. Collections agencies are responsible for receiving a portion of payment for medical providers and may use repeated, aggressive tactics to get payment from you. You could face liens on your home and find yourself with a low credit score until the debt is paid, and years after.
A survey published by the healthcare policy polling group KFF shows that 72% of respondents acquired their debt from short-term treatments, such as a one-time hospitalization or treatment for an acute illness. The remaining respondents claim their debt is a result of ongoing medical bills for treating chronic diseases.
As a way of navigating medical financial strain, eight in 10 adults report they delay seeing a healthcare provider to receive the treatment they need. Putting off care because of the high costs can have a significant impact on your overall health. You can avoid this scenario and have lower medical bills with a robust health insurance plan.
When it comes to reducing medical debt burdens, government initiatives are in place to prevent high costs of healthcare for patients nationwide. A federal plan exists, as well as standards at the state level.
On a national level, nonprofit hospitals have a set of federal debt-protection standards to abide by. These rules aim to protect patients from significant healthcare debt by providing care at discounted rates for those who are eligible. The standards include:
These standards seem decent on paper but contain many loopholes that individual states need to account for. They also don't apply to for-profit hospitals, which make up roughly 24% of the country's hospitals. Even if nonprofit hospitals fail to comply with these standards, they can still keep their nonprofit status based on the Internal Revenue Service's poor history of revoking hospital non-profit statuses.
When it comes to the standards listed above, each individual state can implement its own guidelines for hospitals, including both nonprofit and for-profit facilities. The measures put in place can vary between each state, so it's possible that you could acquire medical debt for treatment in one state while another one provides more leniency.
Leaving each state to decide on financial solutions for medical bills doesn't provide patients with universal debt protections. For example, if you're a Maine resident living under 150% of the federal poverty level, you can receive free healthcare from a hospital. Living at the same income level in Washington, D.C. means you'll only receive relief for medical expenses when you're below 200% of the federal poverty level.
The billing and collections standards that Nevada hospitals must follow include a specific waiting period before sending a bill to debt collectors. Illinois and Washington also allow a waiting period and the additional standard of offering a reasonable payment plan and screening patients for financial assistance, respectively.
Carrying medical debt can severely impact your finances and ability to seek treatment from a trusted provider. By holding health insurance, you can receive the same high-quality care at a much lower cost.
Don't let the high cost of medical services deter you from getting the care you need. Discover how insurance plans make it possible to avoid medical debt no matter what type of treatment you receive.
Don't fret if you suddenly feel sick and need to visit the doctor. With a health insurance plan, you can pay a visit to any in-network provider, meaning a doctor that accepts your insurance coverage, and receive care at a discounted rate.
Most policies cover 100% of the costs for preventative care, including annual physical exams and vaccines. You may have a co-payment if you need to visit your doctor for an emergency visit or see a specialist, but these costs are relatively low for insurance plan members. You need to pay a monthly premium cost for your insurance, and in return, your plan will cover most of your medical bills, though some out-of-pocket payments may be necessary depending on your care.
Even with insurance, you'll have to pay some type of fee, such as a co-payment or a portion of your medical bill, for certain healthcare services. All of these costs go toward your deductible, which is the total amount your plan allows you to pay out-of-pocket each year. Once you reach your deductible, your plan should cover between 60% and 90% of your remaining healthcare costs.
For example, if you have a $2,000 deductible and meet it after undergoing a series of doctor visits and imaging tests, your plan will cover the majority of your future costs throughout the year. You'll need to continue paying your monthly premium to receive these benefits but will have peace of mind that you won't be in medical debt.
Government standards aren't sufficient to ensure your protection against healthcare debt. By enrolling in a health insurance policy, you can clearly see how much you'll need to pay out-of-pocket before the plan covers most of your medical expenses. Protect your health and finances by enrolling in an insurance plan that your local doctors accept and you won't have to worry about the burden of medical debt.
Health emergencies can occur at any time. Give yourself a financial safety net and choose a health insurance plan that protects you. Search for affordable insurance plans with Insurdinary or contact our team for assistance.