One of the most persistent myths concerning our health care system involves the notion that medical bills are forcing huge numbers of ordinary middle class Americans into bankruptcy. This particular brand of BS has been promulgated not only by sloppy journalism, but by politicians who advocate a government takeover of American health care. Barack Obama, for example, repeats the myth on his campaign web site.
A couple of years ago, the medical bankruptcy myth received a major boost when a Harvard study allegedly found that 54% of all bankruptcies are caused by medical bills. To those of us who actually work in health care finance, however, this study was highly suspect because it didn’t match the day-to-day realities that we deal with. In fact, it is the routine practice of most hospitals to write off catastophic patient bills precisely because we don’t want to ruin the patients.
Sure enough, the findings of the Harvard study didn’t hold up under the scrutiny of objective statisticians. David Dranove and Michael Millenson examined the numbers and showed that the authors had cherry-picked the data in order to support their advocacy of universal health care. It turns out that only about 17% of bankruptcies can be plausibly attributed to medical bills and that the actual percentage in which medical bills were truly the deciding factor is probably far lower.
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You wrote: “To those of us who actually work in health care finance, however, this study was highly suspect because it didn’t match the day-to-day realities that we deal with. In fact, it is the routine practice of most hospitals to write off catastophic patient bills precisely because we don’t want to ruin the patients.”
Oh how I wish this was the case for many preemie families. For me, we filed bankruptcy after a year of trying to work with the hospital. Our bill was over $100,000 (after insurance paid thier part). The hospital wouldn’t budge. The not so pleasant person, from the billing department, said, “We kept your daughter alive, why wouldn’t you want to pay us?” Give me a break!
We are not alone either. Many preemie families face the same financial problems that we did.
I guess I wish you were on our side 8 years ago!
Posted 18 Mar 2007 at 8:18 pm ¶I’m not saying that medical bills NEVER cause bankruptcy, just that it is far rarer than is commonly reported in the “news” media.
As it happens, my eldest daughter was a preemie (a tad less than 3 pounds). While it did cause some financial stress—I took to calling her “the face that launched a thousand bills”—it did not require a bankruptcy. I was not employed in the hospital industry at that time (1981), but I worked out a long-term payment plan with the hospital.
Medical care is expensive—everywhere, including Canada and other countries with socialized medicine. And, before we decide it is too expensive, we should consider what we get for our money. In the case of my daughter, who just turned 26, it was worth every penny and more.
Posted 19 Mar 2007 at 8:55 am ¶Post a Comment