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  • 2016-04-21 (xsd:date)
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  • Do 643,000 Bankruptcies Occur in the U.S. Every Year Due to Medical Bills? (en)
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  • In April 2016, a meme was published by the Facebook page The Other 98% (among others) holding that 643,000 Americans declare bankruptcy over medical bills every year, while in a number of other first-world countries, bankruptcies over medical bills are non-existent (due to the implementation of national social health insurance/medical care systems in those other countries): At the fine print at the bottom of the meme was a citation: Source: NerdWallet Health Analysis. No link to the specific analysis referenced was provided, but presumably the item in question was a 19 July 2013 item published by NerdWallet pertaining to medical bankruptcies. However, in that analysis NerdWallet repeatedly stated that their findings were estimates or extrapolations, and some of their data were quite old even back in 2013. The primary portion of that article held that: Although the 643,000 figure didn't expressly appear in that article, if we take the number of bankruptcy filings in the U.S. in 2013 (1,032,236) and apply NerdWallet's statement that three in five (60%) bankruptcies will be due to medical bills, then we arrive at a number of medical bill-related bankruptcies (619,342) reasonably close to the 643,000 figure (although technically a bankruptcy filing can represent more than one person). Likewise, a 2013 CNBC item based on the 2013 NerdWallet Health Analysis included a chart showing the estimated total number of medical-related bankruptcies in the U.S. in 2013 to be 646,812, which is also quite close to the cited 643,000 figure: Since the number of bankruptcy filings in the U.S. is a matter of public record, the accuracy of this figure hinges on how reliable is the estimate that 60% of those filings are medical-related. In NerdWallet's Methodology & Sources section, the site said their medical bankruptcy estimates were based on a 2009 Harvard study, which in turn used bankruptcy data from 2007 and involved interviewing a random national sample of a bankruptcy filers: NerdWallet themselves reported that they employed a more conservative estimate than the Harvard study figure regarding the proportion of bankruptcies that are medical-related: Still, quantifying the occurrence of medical bankruptcies can be problematic, as noted in aJanuary 2016 New York Times article on the subject: However, that article also factored in a large development that occurred after NerdWallet's 2013 analysis: the activation of major provisions of the Patient Protection and Affordable Care Act (also known as PPACA, ACA, or Obamacare): The potentially ameliorating effect of the ACA on bankruptcies was also cited by a July 2015 Wall Street Journal article which (in part) described research into medical bankruptcy done by Northeastern University law professor Daniel Austin: But even prior to the implementation of the ACA, some sources questioned the true impact of medical debt on bankruptcy rates. A 2012 piece published by The Hill compared rates of bankruptcy between the United States and Canada (the latter a country with single-payer healthcare system): Canada wasn't the only country in which the presence of single-payer healthcare reportedly wasn't a total shield against bankruptcies (medical-related or otherwise). A 2010 World Health Organization (WHO) paper [PDF] found that: In short, using some very specific analyses, one could make the case that (at least within the last several years) about 643,000 Americans declared bankruptcy annually due to medical bills. But the accuracy of those analyses is open to question, the playing field has changed significantly since they were undertaken (due to the implementation of the ACA), and it's far from an absolute that the other countries listed in the meme experience zero medical-related bankruptcies. (en)
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