URL: http://www.commondreams.org/views05/0212-10.htm
Saturday, Feb 12, 2005 Miami Herald
MEDICAL BANKRUPTCY: EVEN INSURANCE MAY NOT SAVE YOU
ELZABETH WARREN- Health insurance? That didn't protect one million Americans who were financially ruined by illness or medical bills last year. A comfortable middle-class lifestyle? Good education? Decent job? No safeguards there. Most of the medically bankrupt were middle-class homeowners who had been to college and had responsible jobs -- until illness struck.
As part of a study at Harvard University, our researchers interviewed a sample of 1,771 Americans in bankruptcy courts nationwide. To our surprise, half said that illness or medical bills drove them to bankruptcy. So each year, 2 million Americans -- those who file and their dependents -- face the double disaster of illness and bankruptcy.
But the bigger surprise was that three-quarters of the medically bankrupt had health insurance. How did illness bankrupt middle-class Americans with health insurance? High co-payments, deductibles, exclusions from coverage and other loopholes left some holding the bag for thousands of dollars in out-of-pocket costs. But medical problems often bankrupted even families with Cadillac coverage.
Too sick to work, they suddenly lost their jobs. With the jobs went most of their income and health insurance -- a quarter of all employers cancel coverage the day you leave work because of a disabling illness; another quarter do so in less than a year. Many of the medically bankrupt qualified for some disability payments and had the right under the COBRA law to continue their health coverage -- if they paid for it themselves. But how many families can afford a $1,000 monthly premium for coverage under COBRA, especially after the breadwinner has lost his or her job?
Bankrupt families lost more than just assets. One out of five went without food. A third had their utilities shut off, and nearly two-thirds skipped needed doctor or dentist visits. These families struggled to stay out of bankruptcy. They arrived at the bankruptcy courthouse exhausted, brought low by a healthcare system that could offer physical cures but left them financially devastated.
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Full at: http://www.commondreams.org/views05/0212-10.htm