July 4th is a day to celebrate our many freedoms. One of our most important freedoms should be freedom from fear, including fear of financial ruin because of medical bills. You may not know that almost half of all bankruptcies in the United States are related to costly illnesses and failure to pay medical bills. And to me, that is just wrong.
A friend of mine recently faced bankruptcy over an enormous hospital bill incurred by the emergency hospitalization of his four-year-old son. Even though he had insurance, the amount he would have been required to pay was far more than his limited resources could handle. He and his wife were literally sick with anxiety. He was panicked that his inability to pay the bill would result in a collection agency garnishing his salary or ruining his credit record. I encouraged him to question the bill and talk to the billing department at the hospital. There is almost always a discount or way to settle these bills in a way that fits your budget. In addition to sitting down with the billing department and discussing what he could pay, I suggested he also ask about the hospital's "charity policy" and whether he might be eligible for it. He and his wife both work and he figured their combined income would be too high. To his surprise and great relief, after submitting all the paperwork, he did qualify and the hospital wrote off his bill!
As relieved as we all were by my friend's good fortune, unfortunately he is one of the few lucky ones. So this July 4th, my hope for families and individuals who face medical bankruptcy or high medical bills, is that some day soon, they will experience some freedom from that fear because of some new laws and programs.
- The Affordable Care Act (aka health reform) is already helping families faced with large medical bills in a number of ways. The ACA has removed lifetime maximum limits on health insurance, meaning that insurance companies can no longer limit what they cover over your lifetime. (It has been common to put million dollar limits on lifetime coverage and sometimes even less.) The companies also cannot put "unreasonable" annual limits on your coverage. Because the term "unreasonable" is a little vague, the decision about these rate increases is regulated at the state level. Reform allows states to regulate increases in the premiums you are charged. In some states, they can actually deny unreasonable premium hikes; in other states, they must use the bully pulpit and public shaming to get insurance companies to back down.
- Individuals who have no insurance but are ill, often face medical bills they cannot pay. States have now established insurance pools (sometimes called "high risk pools" or "pre-existing condition pools") for people who face high costs but have previously been uninsurable. In a post I wrote a few weeks ago, I described these pools as one of the best kept secrets of health reform. It's not really a secret, of course, but surprisingly few people know about this program or have taken advantage of it. If you have been uninsured for at least six months, you should check out the program in your state. This program could prevent you from having to declare medical bankruptcy.
While we are not yet free of all fear of medical bankruptcy, the Affordable Care Act has helped many families already, and it will continue to help us all as it is fully implemented in 2014 and beyond. July 4th can be a kind of Health Independence Day for us all.