The vast majority of people have experienced, are dealing with, or will someday likely endure any number of medical problems. Serious diseases, chronic conditions, and grave injuries or accidents often mean a trip to the nearest hospital. In the United States — even for those with health insurance — such events are often extremely costly.
24/7 Wall St. reviewed data from Urban Institute’s report, Past- Due Medical Debt among Nonelderly Adults, published in March 2017. In 2015, 23.8% of nonelderly adults across the country reported past-due medical debt, down from 29.6% in 2012.
> Nonelderly adults with past-due medical debt: 18.6%
> Uninsured rate: 6.6% (17th lowest)
> Median household income: $75,847 (the highest)
> Premature deaths per 100K: 317 (22nd lowest)
The prevalence of delinquent medical bills varies substantially by state. Mississippi leads the nation with 37.4% of nonelderly adults with past-due medical debts, while just 5.9% of nonelderly adults in Hawaii reported such debts, the lowest share.
The physical decline that comes with age means medical problems are far more common among elderly individuals than other adults. This is not the case for past-due medical debt, however. Of Americans 25 to 34 years old, 27.8% report past-due medical debt, the highest share of all age cohorts. By contrast, among people 55 to 64, 19.2% report past-due medical bills, and among 65 and older individuals, the share is even lower.
The relatively low prevalence of medical debt among older Americans is likely due to high Medicare coverage rates. Older Americans often have higher incomes and typically have accumulated more savings, which could also explain the debt burden differences between age cohorts.
“A fundamental function of health insurance is to protect people against the risk of unexpected medical bills,” wrote Urban Institute researchers. And while health insurance does not fully offset the costs of medical problems, nor does it eliminate the risk of debt, it is not especially surprising that states reporting low health insurance coverage rates tend to have the highest levels of residents with past-due medical debt.
The percentage of people without health insurance is greater than the national uninsured rate of 9.4% in just four of the 25 states with lower shares of nonelderly adults reporting past-due medical bills. Meanwhile, residents of 18 of the 25 states with high levels of residents reporting of medical debt are more likely than the average adult nationwide to not have health insurance.
Income is also a major factor in the likelihood of incurring unwieldy medical bills. Medical debt is most common among households earning between $25,000 and $34,999 annually, with 30.8% of such households reporting past-due medical bills. In 16 of the 25 states with lower past-due medical bills, the typical household earns more than $55,775 a year — the national household median income. This is the case in only four of the 25 states with higher delinquent medical debt.
Citing 2016 research by the Kaiser Family Foundation, Urban Institute researchers wrote, “Families with medical debt report that it reduces their ability to save and to afford basic household needs, increases their reliance on credit cards and other forms of debt, damages their credit, and induces them to forgo needed health care.”
People in states with the most past-due medical debt also tend to be less healthy and report higher incidence of premature death. The number of deaths before age 75 per 100,000 Americans is 473 in a year. Converted to years, that figure amounts to 7,054 years for every 100,000 people nationwide annually. The premature death rate is lower than the national average in 22 of the 25 states with lower medical debt burden. It exceeds the national average in 22 of the 25 states with higher prevalence of past-due medical debt.
To identify the states with the most past-due medical debt, 24/7 Wall St. reviewed the percentage of nonelderly adults who reported in 2015 having past-due medical debt in each state from the Urban Institute March 2017 report, Past-Due Medical Debt among Nonelderly Adults, 2012-2015. Adults reporting that they do not know if they have past-due medical debt or who refuse to report whether they have past-due medical debt were excluded.
The percentage of adults without health insurance in each state (the uninsured rate), and the median annual household income came from the U.S. Census Bureau’s 2015 American Community Survey. The premature death rate, measured in lives and years lost before age 75 per 100,000 people in each state annually were aggregated from the county level using 2016 data from County Health Rankings & Roadmaps, a joint program of the Robert Wood Johnson Foundation and University of Wisconsin Population Health Institute.