Health Bills Top Cause Of Bankruptcy | Don't Be Left With no Insurance

Unemployment is high and retirement accounts have virtually disappeared for many folks in the wake of the existing recession. Housing prices have plummeted, too. So it comes as no surprise that data just released by the Administrative Office of the U.S. Courts shows the total number of U.S. bankruptcies filed during the first three months of 2009 increased 34.5 percent over the same time in 2008. But what is surprising is a new Harvard study available in the August 2009 issue of The American Journal of Medicine which reveals financial woes starting hitting Americans even earlier than the officially recognized economic downturn -- and the main culprit was illness and health statements.

The results of the first-ever national random-sample survey of bankruptcy filers, conducted by researchers at Cambridge Hospital and Harvard Medical School, Harvard Law School and Ohio University, show so as to in 2007, 60% of all bankruptcies in the United States were driven by sickness and related medical statements. Moreover, the share of bankruptcies attributable to health woes over the past few years has been on the upswing.

The investigators surveyed a random national sample of 2,314 bankruptcy filers in 2007, studied their court records and then interviewed 1,032 of these economically strapped individuals. Bankruptcies were designated as "medical" based on the affirmed reasons a individual had for filing, revenue loss due to sickness and the quantity of their medical bills they owed. By relying on identical definitions in both 2001 and 2007, the researchers concluded that the share of bankruptcies caused by medical concerns had soared by almost 50 percent throughout those years. In fact, the chances a bankruptcy had a health cause were 2.38 fold higher in 2007 than in 2001.

The results of the study revealed that a selection of conditions pushed many middle-class Americans over the edge into bankruptcy, even when they had health insurance. For example, 92 percent of the medically bankrupt ended up in that fiscal state due to high health statements. And innumerable families who had medical insurance were under-insured, leaving them responsible for thousands of dollars in medical statements they couldn't pay. In fact, out-of-pocket medical charges averaged just under $18,000 for those who had private insurance and yet went bankrupt due to medical expenses. Uninsured patients were faced with $26,971 in out-of-pocket expenses.

Article Source: http://www.moneyarticlelibrary.com

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