Medical Debt from COVID19 Hospitalizations and How it Affects Lower Income Patients
Throughout the time that the Coronavirus has existed, especially during peaks in infection rates, hospitals have been filled with patients suffering from the virus. Hospitalizations from COVID can cause medical emergencies and leave people in the hospital for many days with urgent care needed in order to survive the health effects caused by the virus. In many cases, COVID-related hospital bills become very expensive and require large sums of money to pay off. These hospital expenses can become an extreme financial burden for many families, especially those with lower incomes, if they have to pay the full amount of their visit. A lower-income patient’s expenses from their hospital treatment can be very difficult to pay upfront and can be transferred to medical debt they will be required to be paid off.
Congress passed a bill which temporarily limits/inhibits how much money debt collectors can collect from their patients, and therefore can temporarily lighten the collections of what patients are required to pay off. However, at any point in the future, congress can allow the resumption of their collections and cause serious finical problems for lower-income families. At the moment, studies will show a decrease in nationwide medical debt because the COVID-19 Medical Debt Collection Relief Act of 2021 currently negates a large amount of the debt caused by the Coronavirus. If normal debt collection procedures are allowed to resume, nationwide medical debt will surely increase when the statistics include the debts that are currently paused.
There are other laws that were passed in order to assist the already financially-strained victims of COVID19. As said by Lindsey Muniak, “There is a provision in the Affordable Care Act that requires nonprofit hospitals in the U.S to provide free or reduced-cost care to families below a certain percentage of the poverty line.” The U.S government gave extreme tax exemptions to these nonprofit hospitals in exchange for the hospitals to give lower income patients extreme discounts on their hospital bill or give them free treatment. Nonprofit hospitals make up the majority of hospitals in the U.S and therefore the tax exemptions distributes billions of dollars back into these hospitals. However, many of these hospitals do not provide all their lower income status patients with the information that they can be exempt from paying their full hospital bill. Hospitals also require plenty of documentation of yearly income which can be difficult to submit, especially after suffering from the Coronavirus. It can be difficult to obtain all the documents needed for free care, depending on how accessible the documents are to them. Ultimately, plenty of lower income hospital patients do not get the “deal” they are supposed to and end up having to pay the full amount. Many patients with the income status that should allow for them to avoid paying the full amount end up paying their hospital bill in full because they are unaware of their possible exemptions. Unfortunately, lower-income families are not often provided with the resources they are intended to have and have to pay the full amount of their hospital bill.
Medical debt for lower income families can become a longterm issue that they’ll have to cope with for years to come. In many cases, lower income families trying to pay off medical debt will have to take out private loans in order to pay for utilities or other necessities. Private loans typically come with high interest rates which can plummet the families finances. Many lower income-families who aren’t aware that they qualify for much cheaper or free care end up being thousands of dollars in debt from their health crisis that need hospital treatment. Muniak comments on patients with overdue medical debt, “If a patient still isn’t able to service their debt, the provider will often intensify the collections effort which often results in the patient being sued.” These lawsuits go to court and in several cases, the patient won’t show up for various reasons, and the judge will rule in favor of the provider. Therefore, as explained by Muniak, “This allows for providers to pursue wage garnishments against patients.” Wage garnishments are amounts of money that the provider will automatically be able to take off the patients pay check. It is obvious that these wage garnishments can severely impact a family below the poverty line.
During peaks in infection rates of the Coronavirus, hospitals all over the country were close to if not at full capacity of patients suffering from the virus. Many of these patients of these patients qualified for special status because they had lower incomes. However, several of these families across the U.S are still required and expected to pay the full amounts of their hospital bill, or else the providers of the service will give the bill to debt collectors. Once the temporary limitation of debt collecting procedures are at any point resumed, many of these families will once again be at high financial strain. Medical debt can be an extreme financial burden for families who are below the poverty line, and have caused and will continue to cause hardships for these lower-income families.
Works Cited
Medical Debt Burden in the United States. https://files.consumerfinance.gov/f/documents/cfpb_medical-debt-burden-in-the-united-states_report_2022-03.pdf.
“Medical Debt Fell during the Pandemic. How Can the Decline Be Sustained?” Urban Institute, 11 May 2022, https://www.urban.org/research/publication/medical-debt-fell-during-pandemic-how-can-decline-be-sustained.
“New Survey: More than Half of U.S. Adults Who Contracted Covid-19 or Lost Income during the Pandemic Also Struggled with Medical Bill Problems.” Commonwealth Fund, 16 July 2021, https://www.commonwealthfund.org/press-release/2021/new-survey-more-half-us-adults-who-contracted-covid-19-or-lost-income-during.
Interview with Lindsey Muniak, Debt Collections.
