Study Finds Medical Bills Drive About Half of Personal Bankruptcies

Medical bills may lurk behind about half of personal bankruptcy filings in the United States, according to Harvard University researchers who also found a majority of the debtors they surveyed were middle-class, owned homes and had health insurance at the onset of their illness.

The study, to be published Wednesday in the journal Health Affairs, examined personal bankruptcy filings from 2001 in five federal court districts, including Illinois.

“Our study is fairly shocking,” said Dr. Steffie Woolhandler, an associate professor of medicine at Harvard Medical School and a primary-care physician. “We found that, too often, private health insurance is an umbrella that melts in the rain.”

For many, health problems set in motion a downward spiral that led to unemployment and subsequently the loss of health insurance, Woolhandler said. Or, their coverage was filled with so many high co-payments, deductibles and uncovered services that they couldn’t pay their bills. Out-of-pocket expenses averaged $11,854 for the medically bankrupt.

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