American Families Are Being Crushed By Medical Debt [CHARTS]

While not everyone agrees that the Affordable Care Act is the solution, there’s no denying that there’s a problem: Americans are being crushed by medical bills.

More than 1 in 4 families were burdened by medical expenses in 2012, 1 in 5 were paying off medical debt, and 9 per cent had bills that they could not pay at all, found a Jan. 28 analysis of data from a large CDC survey.

Here’s a look at just widespread the problem is:

While those with incomes at or below 250% of the federal poverty level — which today means $US48,825 for a family of three — felt the burden of these costs the most, healthcare-related financial problems were not limited to that group.

Families in which every member was insured were also not immune to the ballooning costs of medical care, but they were still the least likely to be struggling with medical bills:

The researchers were not sure why families who have a mixture of insured and uninsured members (the far right column) have higher rates of financial burden than those who are 100% insured, but they told us via email that a “mixed” insurance situation includes only a small percentage of families.

The consequences

In recent years, the cost of healthcare — and the share that individuals are responsible for paying — has been rising.

The implications of these findings go beyond mounting debt and thinning bank accounts. When people have medical-related financial stress, they often miss out on potentially life-saving treatment.

An earlier report by The Commonwealth Fund found that “two-thirds of people with a medical bill or debt problem went without needed care because of cost — nearly three times the rate of those without these financial problems.”

As the last chart above makes clear, people with insurance are already less likely to be burdened by medical costs than those without. The Affordable Care Act will expand the number of people who have insurance and mandate coverage of many costs that may have previously fallen to patients.

And the ACA’s strict limits on the maximum annual amounts people can spend on health-related expenses — $US6,350 for an individual plan and $US12,700 for a family plan — are designed to offer some protection against spiralling medical debt. (That benefit will not kick in on all plans until 2015.)

But it’s important to note that in its current form, the ACA will reduce, but not necessarily end medical bankruptcies and other healthcare-related financial problems.

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