JustCare

Tag: Debt

  • Millions of adults still carry significant student debt

    Millions of adults still carry significant student debt

    The Biden Administration tried to eliminate some student debt. But, a federal appeals court stopped the Saving on a Valuable Education Plan (SAVE) from moving forward, while it considers its legality. Instead the eight million people who had enrolled in SAVE still face considerable debt. Oyin Adedoyin reports for the Wall Street Journal on the likely future for these people during a second Trump administration.

    Millions of Americans are burdened by student loans, including nearly three million older adults. Older adults also owe more than $54 billion in medical debt. But, relief is nowhere in sight for them or for tens of millions of other Americans with student debt or medical debt.

    People with student debt are at a loss as to what to do. Many are part of a public-service loan forgiveness initiative. They expected the balances on their loans to be eradicated once they had made 120 monthly payments. And, they had planned for that future.

    People who are part of the SAVE program are in limbo at the moment. They need not pay anything on their loans, and they will not be penalized for doing nothing. But, until the lawsuit ends, they are stuck.

    Around a million public-service workers in SAVE thought their monthly loan repayments would come down around $1,000 a year, on average, and, for some, go away entirely. Instead, at least for now, the Biden Administration is only able to help 55,000 public service workers through the Public Service Loan Forgiveness Program.

    Many Republican policymakers in the states challenged the SAVE program on the grounds that it is expensive and illegal. Trump has called the program a “catastrophe.”

    People in SAVE who have worked in public service for at least 120 months, but who have not made 120 loan repayments yet, could be able to “buy back” the right to loan forgiveness. They might have to pay in more. Or, they could sign up for a different repayment plan based on income.

    Here’s more from Just Care:

  • Hospital billing practices frequently leave people without medical care or in court

    Hospital billing practices frequently leave people without medical care or in court

    The Lown Institute reports that if you aren’t able to pay your hospital bills, you have a one in three chance of being sued. On top of that, some hospitals are refusing to allow you to schedule new appointments.

    Almost half of adults in the US find affording the cost of healthcare challenging. Forty percent of them have medical debt. And, many of those people in debt end up choosing to go without medical care or to leave the hospital against medical advice. Medical debt now totals somewhere between $81 to $140 billion.

    The Lown Institute is collecting information on each hospital’s billing and collection practices. People should know which hospitals to avoid. That said, many hospitals are struggling to survive. There’s no excuse for hospitals filing lawsuits against patients, but the hospital system is broken. And, there’s also no excuse for the government standing back and watching hospitals go bankrupt because insurers are not paying them, to the detriment of their constituents.

    The Leapfrog Group, Northwestern University Feinberg School of Medicine, and Johns Hopkins University School of Medicine published a recent analysis of some hospital billing and collection data in JAMA. Of the more than 2,000 hospitals studied, a third said that they bring lawsuits against patients for delayed or inadequate payment of their bills. Rural hospitals sue patients more frequently than urban and suburban ones.

    What’s equally appalling is that hospitals often do not provide patients with itemized bills within a month of services. And more than one in 20 hospitals surveyed had no representatives to help patients with billing questions or to look into billing errors or to set up a payment plan.

    What is to be done? Lown does not propose national health insurance, likely because it’s not on the table at the moment. It should be. That’s the only way to ensure health equity and end medical debt. It’s also a far better way to ensure hospital solvency than allowing hospitals to sue patients for money they don’t have.

    Lown is focused on better hospital billing practices. Insanity. Who could step in to ensure that hospitals did a better job of billing patients? The JAMA authors say that if we standardized hospital billing practices, there would be greater accountability. Good luck! At the very least, we should be standardizing hospital prices.

    We should not leave it to the states to fix this problem. They do not have the will, the skill, the money or the power to take this on. Yes, a couple of states have done a little on credit reporting of medical debt. That’s something, but not wildly enough. How many millions more people will suffer the indignity of not being able to get medical care or of not being able to afford medical care or of being sued for not being able to pay medical bills before Congress acts?

    Lown Institute suggests that documenting the problem could help promote health care affordability and hospital accountability. By the time they have the data they need and anyone’s attention, tens of millions of Americans will have been harmed by our travesty of a healthcare system.

    Here’s more from Just Care:

  • Congress should lift debt ceiling, protect against Republican threats to Social Security and Medicare

    Congress should lift debt ceiling, protect against Republican threats to Social Security and Medicare

    In an op-ed for The Hill, Nancy Altman, Chair of Social Security Works, speaks to the Democrats’ need to lift the debt ceiling during the lame duck session of Congress. If they don’t, the Republicans have made clear that they will refuse to raise the debt ceiling without cuts to Social Security and Medicare.

    The public supports strengthening and expanding Social Security and Medicare. Still, Republican policymakers have said and continue to say that they want to cut these programs. Medicare and Social Security demonstrate that government can be a force of good. Privatizing them, however, would be good only for Wall Street.

    It’s because the Republicans in Congress have claimed they want to cut Social Security that the so-called “red wave” turned into a “red mirage.”  For example, in Arizona, Mark Kelly prevailed against Blake Masters, who argued for turning  Social Security over to Wall Street during his campaign. Similarly, in New Hampshire, Maggie Hassan prevailed against Don Bolduc, whose campaign platform included cutting and privatizing both Social Security and Medicare.

    In Wisconsin, Ron Johnson nearly lost re-election. He had argued for cutting Social Security and Medicare in coded language. He said that he wanted to turn Social Security and Medicare into “earned benefits,” which is code for eliminating their guaranteed benefits.

    But, this all notwithstanding, the Republicans will hold a slim majority in the House in 2023. And, they plan to use that majority to prevent Congress from raising the debt ceiling, endangering the US and worldwide economy . . . unless Congress cuts Medicare and Social Security.

    Altman notes that Republicans have said explicitly and repeatedly that they plan to hold the economy hostage. The Republican candidates for the House Budget Committee all told Bloomberg of their intention to insist on cuts to Social Security and Medicare in exchange for their support for raising the debt ceiling.

    The incoming House Majority Leader, Kevin McCarthy has not explicitly said he wanted these cuts. But, he has made clear that he wants big policy changes–implying cuts to Social Security and Medicare–in exchange for Republican support for lifting the debt ceiling. Representative Buddy Carter of Georgia said that Republicans’ “main focus” was on “entitlements,” code for Medicare and Social Security.
    If you have doubts that Republicans would follow through on their threat, you need only look to 2011 and 2013 when they attempted to carry it out. Fortunately, they failed to cut Social Security and Medicare as a result of grassroots opposition. However, they did succeed at cutting some discretionary spending programs.
    The wisest course for Democrats would be to act now to raise the debt ceiling or end it altogether, before the Republicans take control of the House in the new year. That way, they could be sure to protect Social Security and Medicare.
    Here’s more from Just Care:
  • Avoid a lawsuit, don’t sign nursing home admissions form

    Avoid a lawsuit, don’t sign nursing home admissions form

    Noam Levey reports for Kaiser Health News on nursing homes that sue the friends or family of residents to collect debt. And, it appears not to matter whether the friend or family has power of attorney or control of the patient’s assets. What usually matters is that a friend or family member signed the nursing home admissions form for the patient.

    Searching through Rochester, New York court records, Levey found 238 instances in which 24 nursing homes sued patients, relatives or neighbors in order to try to collect on a patient’s debt, in a three-year period. More than 70 of those cases were targeted at someone other than the patient or the spouse, who often did not have power of attorney over the patient. In one case, the sister of a nursing home resident was sued for $8,000 by the nursing home, even though she had no control over his health or finances and no legal responsibility for his debts.

    Levey found 60 cases in which the local government sued to collect nursing home debt over that same three-year period.

    Federal law should protect people from these lawsuits. Nursing homes are not allowed to force patients’ friends and families to guarantee their bills. But, the fine print in the nursing homes’ admission agreements often include something that a relative or friend signs, unwittingly, giving the nursing home debt collection rights.

    In many lawsuits, the nursing home has no evidence that the person being sued should be responsible for the bill. But, the nursing homes win many of these cases via default judgments because the person they are suing ignores the suit or does not have the means to hire a lawyer to defend them.

    New York is not the only state where this is going on. Levey reports that lawyers in Kentucky, Massachusetts, Illinois and California suggest that it is not uncommon for a nursing home patient’s family or friends to be sued to collect debt in their states.

    A recent Kaiser Family Foundation poll found that around 14 percent of adults with medical debt report being threatened with arrest or a legal action. Five percent report being sued.

    Tip: If you help a family member or friend get admitted to a nursing home, do not sign any papers. Make sure that, if anyone signs, it is the patient who signs.

    Here’s more from Just Care:

  • Medical debt rising for people who pay through their credit cards

    Medical debt rising for people who pay through their credit cards

    Millions of people max out their credit cards, and an increasing number max out because of a costly medical condition. Patients want to pay their medical bills, or they must pay their bills in order to receive care. But, these days, using a credit card to pay medical bills likely means a medical debt hike because interest rates are rising, reports Bob Herman for StatNews.

    Using a credit card when you are unable to pay off the debt as required by the bank issuing the card is a risky proposition and a particularly risky one now. Interest rates are rising. Credit limits are shrinking. Failing to pay the minimum jeopardizes your credit rating and could lead to all kinds of toxic consequences, including wage garnishment and lawsuits.

    Each time the Fed raises its interest rate, the cost of borrowing money for just about any reason is likely to increase. Credit limits could shrink, leaving people with more debt on their credit cards than is permissible. They are potentially liable for higher penalties if they don’t pay the debt back. And, getting credit is also likely to be more difficult.

    If you can’t pay your medical bill, whatever you do, think twice before agreeing to a credit card from your hospital. The card might seem appealing and help you at the moment, but it could have exceptionally high interest rates. Credit card interest rates are already very high, as much as 21 percent. People who owe more are likely to be charged higher rates because they present greater credit risk.

    One hospital credit card, CareCredit does not charge interest for as long as 24 months if cardholders pay off their debt. But, people who do not pay off their debt can be stuck with interest from day one. And, the interest rate charged is currently 27 percent for new accounts.

    Anyone who is struggling to pay for medical care should look into Medicaid eligibility requirements in their state. Many states allow you to “spend down” to Medicaid eligibility levels, meaning that even if your income is above eligibility levels, if your medical expenses bring that income down to below eligibility levels, you could qualify for Medicaid. Assets will be considered, but the value of your home, if you own it, is not considered. If you qualify, Medicaid could retroactively cover some of your care.

    Here’s more from Just Care:
  • Costs now keep one in three Americans from getting care

    Costs now keep one in three Americans from getting care

    A new Gallup and West Health study finds that almost one in three Americans are skipping care because of the cost. That’s a huge jump up in the number of Americans  skipping care because of cost in the last six months alone. The US has always rationed care based on the ability to pay, and the consequences are dire for more and more people.

    Costs are not only a barrier to care for people with average and lower incomes; they are a barrier to care for people with annual incomes of more than $120,000. One in five households with incomes above $120,000 a year have skipped getting care–seven times the proportion who skipped care less than one year ago.

    And, it’s hard to imagine a time when health care costs will stop increasing. The market does not control health care costs effectively. So, costs keeping going up for health care, including prescription drugs. That’s why every other wealthy nation regulates health care prices.

    The Gallup survey found that more than 12 million people knew someone who skipped care and then died as a result. One in five people knew someone whose condition worsened because the person skipped care.

    Nearly one in four Americans report that the cost of their health care is taking a toll on them financially. And one in three Americans with annual incomes under $48,000 are facing huge financial burdens because of their need for care. Deductibles, copays and coinsurance are all rising.

    Two in three Americans are in debt, and medical debt is the largest portion of debt. Literally, one in two Americans are now in medical debt. Medical bills are the biggest reason so many Americans are in debt.

    Most people no longer think their health care charges are reasonable. Rather, they don’t think they are getting their money’s worth. More than half (52 percent) reported that the health care they got wasn’t worth what they had to pay for it.  That’s up from last April, when 43 percent said their care wasn’t worth the cost.

    We pay more and more for our health care, yet we continue to fare worse, often significantly worse, than our peers in other wealthy country. Increasingly, however, the health care stakeholders responsible for our exorbitant health care costs control our policymakers, and keep them from regulating prices. We need to vote in more representatives who represent us.

    Here’s more from Just Care:

  • Death and debt by deductibles

    Death and debt by deductibles

    Note: This post was originally published on The Potter Report.

    Congrats, America! Earlier this month you passed an annual milestone: Two days after Tax Day, you made it to… Deductible Relief Day!

    What’s that? It’s the day where the average person with employer-based health insurance has spent enough on health expenses to finally meet their deductible.

    Health insurance deductibles have been rising so rapidly (year after year after year) that the Kaiser Family Foundation decided to track the trend to show how severely Americans are getting ripped off (and sick). And it’s bad.

    As you might guess, the Deductible Relief Day is being pushed further each year. In 2005, you had to wait until February 28. By 2009, you wouldn’t be popping champagne until March 18. In 2019, you waited two months more than that.

    As the Kaiser Family Foundation noted, in 2009, the average deductible was $533 for a single person. In 2018, it was $1350. How? The insurance industry strategy of moving all of us into high-deductible plans (one of the many gross abuses I saw first-hand at Cigna) has paid off well for my former employers.

    In 2018, about 85% of covered workers were enrolled in a high-deductible plan, up from just 50% ten years earlier. Another way of looking at this: Average enrollee spending on deductibles more than tripled between 2007 and 2017.

    And Kaiser didn’t look at people who buy their coverage on their own through the ACA exchanges. They’re in even *worse* shape. The Commonwealth Fund found that 40% of people in ACA plans are underinsured because of high out-of-pocket charges – and many likely never meet their deductibles.

    As a result, millions of Americans are not going to the doctor or picking up prescriptions. Insurers LOVE that. It’s far fewer claims to pay! It’s why, when many other businesses went belly up during COVID-19, insurers made record profits: medical treatment was less accessible!

    President Biden, are you paying attention to this? You must.

    Millions of people WITH insurance who voted for you, including folks on Obamacare, CAN’T USE IT because of deductibles! Insurers can charge families up to $7,200 before they’ll pay a dime. It keeps going up. Every. Single. Year.

    No wonder more and more Americans with insurance are turning to GoFundMe or bankruptcy court. It’s not just the premiums you gotta worry about, Joe. Deductibles are eating us alive. You and Congress need to pay attention before NO Americans can meet their deductibles.

    Here’s more from Just Care:

  • Debt among older Americans increasing in good part because of health care costs

    Debt among older Americans increasing in good part because of health care costs

    More older Americans are facing debt now than 20 years ago, reports the Employee Benefits Research Institute (EBRI). And the size of their debt is twice what it has been. One principal reason: Health care costs.

    Medicare only covers about half of a typical person’s health care costs, in large part because it does not pay for long-term supports and services. Expanding and improving Medicare for everyone in the US would help reduce debt significantly for older adults. Not only would it cover health care costs in full, without copays and deductibles, it would cover long-term care. Expanded Social Security benefits would also help tremendously.

    The government and businesses once helped to support older people in retirement to a far greater extent than they do today. Medicare covered a larger proportion of people’s health care costs and people did not have to rely as heavily on their Social Security benefits for basic needs as they currently do.

    According to EBRI, “American families with heads just reaching retirement or those newly retired are more likely to have debt — and higher levels of debt — than past generations.” The EBRI data show that 68.4 percent of older adults 55 and older faced debt in 2019, up from 53.8 percent in 1992. Fifty-seven percent of older adult heads of household between 65 and 74 carried debt in 2016. In 1998, 47 percent of them carried debt.

    The proportion of older adults 75 and older with debt is higher than it has been since 1992. In 2019, 51.4 percent of heads of household who were 75 and older carried debt. In 2007, 31.2 percent of them carried debt.

    Total debt for 50 to 64 year olds increased by 50 percent between 1992 and 2016, from $80,000 to $120,000. But, for all people 55 and older, average debt decreased a bit from $88,245 in 2010 to $82,481 in 2019.

    Older adults represent about 12 percent of people filing for bankruptcy. That’s five times the percentage of older adults who filed for bankruptcy 25 years ago.

    As wealthy people age, their debt tends to fall. As people with less wealth age, their debt tends to grow. And mortgage and credit card debt are most prevalent among people 70 and older.

    Blacks and Hispanics and people with low incomes are at severe risk of economic insecurity as they get older. They are more likely than white Americans to spend 40 percent of their income paying off their debt. They are most likely to have credit card debt and loan debt to pay for basic needs.

    Older adults also often have student loan debt to pay off. It can be their student loans or their kids’ loans.

    Here’s more from Just Care: