Even among those with private coverage, medical debt stemming from both hospital visits and routine care looms large over about a third of U.S. adults, according to a nationally representative Commonwealth Fund survey.
The thinktank reviewed over 4,100 survey responses from adults with continuous employer, Affordable Care Act marketplace or individual market coverage, as well as focus groups with 45 participants.
That survey, conducted from July to October of last year over the phone or online, found 32% were paying off medical bills or debt, with higher rates among women (37%), those with low or moderate incomes (38%), those living in the South (39%) and people who reported Black ethnicity (41%). More than a third of the full sample said they would not be able to pay an unexpected medical bill of $1,000.
About 46% of those with medical debt said it totaled $2,000 or more, and 19% said it ran over $5,000. The former number, Commonwealth said, translates to an estimated 15% of all U.S. working-age adults with private insurance.
Among those with medical debt, 64% said it stemmed from hospitals, whether that was from emergency department (31%), outpatient care (30%) or inpatient care (27%). Forty-three percent reported debt from medical office visits, 38% diagnostics or tests, 25% dental and 6% ambulance. Nearly two-fifths said their debt was related to an ongoing or chronic condition, and “many” focus group participants described accumulating several different bills rather than being caught beneath a single high-cost service like a surgery.
Further, focus group participants pointed to care recommended by their provider but ultimately denied by their insurer as a common source of their medical debt. Many described “frustration” with unexpected bills they had believed to be fully or partially covered, and said as a result they were postponing care and refraining from asking their provider questions during a visit.
“Regardless of the actual amount of debt, people were overwhelmed by aggressive practices of providers and collection agencies trying to obtain payment,” Commonwealth wrote of the focus group responses in its survey report. “Many were unaware of payment plans or debt assistance. Even with payment plans, some participants worry their medical debt would take ‘a lifetime’ to pay off.”
Seventy-eight percent of the respondents with debt said they were making payments directly to providers, as opposed to a collection agency (23%) or financial institution (15%). A quarter said their bill had been reported to a credit rating agency, 4% said they’d been legally threatened over the debt, 3% that their wages had been garnished and another 3% that a lien had been placed on their property.
As a result, stress was commonly reported by the indebted survey participants (68%) alongside a slew of other financial impacts such as depleted savings (37%) and cuts on basic necessities (30%).
Those respondents, when asked who was to blame, broadly pointed a finger at their insurance companies (64%) and the healthcare system at large (57%) ahead of their provider (40%), the government (34%), themselves (23%) and their employer (8%). Commonwealth noted the focus group participants described misaligned incentives within the healthcare system in which individuals are “taken advantage of.” And, “despite blaming insurance companies for their debt, many cited healthcare affordability overall as a major concern. Many felt that providers ‘set these high prices that people can’t pay,’” according to the report.
When asked about specific policies to support those with medical debt, respondents broadly backed the use of interest-free payment plans, financial assistance from hospitals and the elimination of medical debt from consumer credit reports.
Commonwealth, an independent but typically left-leaning thinktank, itself advocated for federal legislation to ban medical debt from credit reports, tighter enforcement of hospital financial assistance requirements, elimination of deductibles, capped provider payment rates and broader government coverage of the uninsured (which it noted will narrow with the implementation of last year’s One Big Beautiful Bill and other policies). The organization has also advocated for state governments to take similar actions to strengthen financial safety nets.