A new report by the Consumer Financial Bureau (CFPB) paints an unsettling portrait as to the extent of medical debt in the U.S. and how it affects individual patients.
Approximately 42.9 million Americans have medical debt that has not yet been paid, according to the agency. Altogether, 52 percent of debt that gets reported to collection agencies is medical in nature, the CFPB said.
Moreover, the Associated Press observed that many consumers may have these unpaid debts because they are confused about the often complicated medical bills they receive and may be unaware that they have an obligation to make a payment. Another recent study by the consumer firm NerdWallet reported that nearly two-thirds of those polled said they had received a medical bill larger than what they had expected.
"A single treatment at a hospital can result in multiple bills from multiple providers. For example, after a surgery, a consumer can receive a bill from the surgeon, the anesthesiologist and the surgery facility," the report stated. "A health insurance policy may cover some providers and some procedures, but not others. And it may cover all or part of a bill. Some consumers may find it difficult to know what they owe, to whom or for what."
Moreover, the sums owed are not inconsequential. The average medical debt owed is $1,766, and it comprises half of all debt on individual reports, according to the CFPB. If someone with medical debt has other obligations as well, the average is more than $5,600. Yet more than half of those Americans with only medical debt are not demonstrating other signs of financial duress.
That medical debt tends to trigger disputes by consumers, according to the AP. And just a $100 debt can strip 100 points off the credit score of someone who already has a sterling payment history.
To learn more:
- here's the CFPB report
- read the Associated Press article