WASHINGTON–Americans owe nearly twice as much medical debt as was previously estimated, according to new research from the Journal of the American Medical Association (JAMA).
The organization said the research shows the amount owed has become increasingly concentrated in states that do not participate in the Affordable Care Act’s Medicaid expansion program.
The new research published in JAMA found that collection agencies held $140 billion in unpaid medical bills last year. The New York Times noted a 2016 study had estimated that Americans held $81 billion in medical debt.
“This new paper took a more complete look at which patients have outstanding medical debts, including individuals who do not have credit cards or bank accounts,” the Times stated. “Using 10% of all credit reports from the credit rating agency TransUnion, the paper finds that about 18% of Americans hold medical debt that is in collections.”
Largest Source of Debt
According to the report, the researchers found between 2009 and 2020 unpaid medical bills became the largest source of debt that Americans owe collections agencies. Overall debt, both from medical bills and other sources, declined during that period as the economy recovered from the Great Recession, the JAMA research found.
The $140 billion in debt does not count all medical bills owed to health care providers, because it measures only debts that have been sold to collections agencies, according to the Times.
The report added the increasing number of lawsuits that hospitals file against patients to collect debt, which can lead to legal fees or wage garnishments, are not included in the figure.
A ‘Misnomer’
“Nor are the medical bills that patients pay with credit cards or have on long-term payment plans. Some of the difference between the new estimate and the older, smaller one may reflect differences in how different credit rating agencies categorize debts,” the report found.
Observed one person in a comment on health insurance, “It’s a misnomer — it’s not just to insure your health. It’s actually to protect you economically in the event of poor health.”