AffordableHealthInsurance.com Survey Finds 56 Percent of Americans Owe Medical Debt Largely Due to Emergency Room Visits
According to the Federal Reserve, U.S. household debt reached over $15 trillion in 2021, an astronomical number fueled by student loans, mortgages, credit cards, and other forms of borrowing.
Given the high cost of healthcare in the U.S., it’s unsurprising that some of this household debt can be attributed to medical expenses. In February 2022, AffordableHealthInsurance.com surveyed 1,250 American adults, finding that 56% of them have medical debt, a circumstance that has ripple effects on many other aspects of their lives.
Key Findings:
- 56% of American adults owe medical debt
- 1 in 4 Americans with medical debt owe $10,000 or more
- Emergency room visits contributed to medical debt for 44% of Americans
- 46% of Americans with medical debt are delaying buying homes because of it; 14% are planning to declare bankruptcy this year
23% Americans owe $10,000 or more in medical debt
Overall, more than half of Americans 18 and older, 56%, have at least some medical debt.
Among these individuals, 55% owe between $501 and $10,000.
However, nearly one-fourth of Americans with medical debt, 23%, owe more than $10,000. Six percent report owing between $50,001 and $100,000, and 5% owe more than $100,000.
The majority of Americans with medical debt, 59%, incurred medical debt with their own healthcare, while 29% say their medical debt includes expenses for dependents.
Regardless of how much they owe, or how the debt was incurred, 32% of Americans with medical debt say it’s ‘unlikely’ or ‘very unlikely’ that they will be able to pay off their medical bills in their lifetime.
1 in 2 insured Americans have medical debt
Insured and uninsured Americans both report having medical debt at similar rates.
Fifty-nine percent of uninsured individuals have medical debt, compared to 56% of those with insurance.
When broken down by type of insurance, those with employer-provided health insurance or health insurance purchased through a marketplace are most likely to have medical debt.
Sixty-nine percent of Americans who have health insurance purchased through a marketplace have medical debt, as do 61% of Americans with employer-provided health insurance. Meanwhile, 47% of Americans who are covered by Medicare or Medicaid have medical debt.
Knowledge gaps could be contributing to higher-than-necessary out-of-pocket costs for insured individuals, according to healthcare advisor Dr. Noor Ali.
“I speak to many people everyday who are seeking health insurance but don’t know the difference between premiums and deductibles,” Ali says. “These gaps in knowledge and information naturally roll over to usage, and perhaps misuse of health policies. Having more education about proper utilization of health insurance policies and knowing when to go to urgent care versus emergency room can help patients avoid significant costs.”
Emergency room visits top contributor to Americans’ medical debt
The number one source of medical debt is emergency room visits, with 44% of respondents selecting this answer as a contributor to their unpaid medical bills.
According to Ali, this is largely due to differences in how emergency room care is delivered versus care in other types of settings.
“To rule out many dire medical diagnoses, a certain level of work up and testing must be performed in an emergency room setting,” she says. “Moreover, services done in an emergency room are often billed at a higher rate to insurance simply due to the high-tech equipment and time-sensitive nature of the tests. This rolls over into higher patient responsibility and more medical debt.”
To avoid the high cost of emergency room care, Noor recommends a different sequence of treatment, if possible.
“If possible, emergencies should first be dealt with via a tele-medicine appointment, then an in-office doctor visit, then an urgent care facility. Emergency room visits should be a last resort,” Ali says.
Other top sources of medical debt are hospitalization (36%), specialist doctors and care (30%), and diagnostic tests (30%).
