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Death by For-Profit Health Care

STRIKE DEBT Executive Summary


his Strike Debt report is part of an ongoing eort by a group of health care practitioners, lawyers, researchers, and activists to expose the disastrous impact of medical debt and for-prot health care on families and individuals in the United States. Private health care enriches a fewinsurance companies, private equity rms, pharmaceutical companies, debt collectors, and global investorsat the expense of everyone else. Medical debt is a weapon of the class war because when patients cannot aord medical care, they are forced into debt, often with far-ranging and catastrophic consequences. As the rate of uninsured has grown, local governments have looked to state subsidies for private health insurance as a band-aid solution. Massachusetts has implemented such a program, and the Obama Administrations Aordable Care Act has expanded this initiative on a national scale. Unfortunately, the ACA will not solve the problem because its primary goal is to expand the market-based system that has already proved to be a miserable failure. Insurance companies prot by denying coverage. As costs rise and benets shrink, patients will continue to pay the price. We are in a major health care crisis, the consequences of which will be felt for decades to come. The only real solutions are: a grassroots social movement to demand universal health care, an end to the scourge of medical debt, and a national conversation on the meaning of health and wellness.

A Strike Debt Report

nies and for-prot providers also fund political campaigns, we can expect no help from politihe price of for-prot medical care is in- cians. The best hope we have is to ally with othcreasing at a relentless pace while quality is ers in our circumstances to ght back and claim declining. Fifty million people have no in- health care as a human right. surance and 77 million have trouble paying medical bills (Rukavina). Despite these inequities, the US spends more on care than any other wealthy In 1996, while insured by United Healthcare, country in the world. The for-prot health care I had to undergo open heart surgery. Seriindustry sucks up 18% of Gross Domestic Prodous stuffyour circulation is diverted to a uct, more than twice what countries that have machine, your ribs opened up, your body publicly-nanced health care spend. Despite the cooled to about 70 degrees, your heart high cost, Americans are sicker and die earlier stopped and cut open, etc. My operation than people in other developed nations (Shorthappened a day later than scheduled, beer Lives). cause on the first attempt, after I was anesPeople without insurance must privately thetized, a tube used in the setup caused nance health care. Less well understood, howinternal bleeding. The second day I was ever, is that medical debt is not only a problem anesthetized again and the operation was for those without coverage. One in ve adults successful. who are privately insured struggles to pay medical bills. Even more scandalous is the fact that Then the billing problem began. United Americans are paying more for weaker coverage Healthcare refused to pay for the second (Shorter Lives). According to the Commonanesthesia because by their rules, they only wealth Fund, the cost of insurance has outpaced pay for one anesthesia for this operation. wage increases for the last ten years. Employers (This, despite the surgeons report about the are shifting these costs to employees and their internal bleeding on the first attempt and families. Premiums increased 62% from 2003 the obvious fact that such a surgery could to 2011 (State Trends). For at least ten million not conceivably happen without anestheAmericans, deductibles are so high that their insia!) For more than six months United Healthsurance plans are little more than scams, providcare continued to refuse to pay, and Mt Siing a false sense of security in hard times (Young). nai Hospital continued to bill me directly for The cost of health care has also risen faster more than $4000. And the in network surthan ination. As a result, over the last few years, geon billed me directly for the half of his fee families have had little choice but to accept lower that United Healthcare wouldnt pay (anwages to hold on to benets that, in the case of a other $2500). Im mighty bullheaded, and serious illness or accident, may not protect them wrote plenty of letters. United Healthcare from nancial disaster. For many working peofinally did pay up. But what if I didnt know ple, the trade-o is simple: your money or your I could fight it, as many people might not? life. If you have a job and insurance, you may feel that you are protected. But that is false. No one is Anonymous, New York truly safe from a for-prot health care industry that preys on patients and families at the most vulnerable moments. Since insurance compa-

Medical Debt: A Weapon of Class War

Were All at Risk

lmost everyone is aected by medical debt. The for-prot health care industry is designed to benet a few at the expense of the rest. Debtors and non-debtors alike are forced to pay out-of- pocket for everything from basic care to life-saving operations. As patients, most of us understand instinctually that someone is making out like a bandit when we get sick. This becomes clear the minute you walk into a doctors oce or a hospital where you open your wallet to make an up-front payment, sometimes called a co-pay, before seeing a doctor. The costs can start piling up from there, even if you have insurance. If you have a serious illness or accident, its unlikely that your insurance will cover allor even mostof the care you need. What insurance doesnt pay, youre responsible for. Predictably, medical debt discriminates along familiar lines. According the Commonwealth Fund, Among the working-age population, 39% of women have medical bill problems, compared with just 25% of men. More than half of working-age African Americans (52%) report medical bill problems, in contrast with 34% of Hispanics and 28% of whites (Seeing Red). Although medical debt aects some more than others, it cuts across lines of class, race, and gender. In fact, rates of medical indebtedness are comparable for people with and without insurance (Consequences). Insurance companies make a prot by denying claims. In the words of Dr. David Himmelstein, of Physicians for a National Health Program, Private health insurance is akin to an umbrella that melts in the rain. It simply isnt there for you when you most need it. PAGE 2

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they are even out of their twenties. Is this what we want for young people in America? The evidence that publicly-funded care is far better than our current system is staggering. It turns out, when it comes to medical debt, it is better to be over 65 and sick than to be young and healthy (Garcia). Older people actually have the lowest rates of medical debt because they qualify for government-supported programs like Medicare. From the right and left of the political esAmericans spent $300 billion on out-of-pocket tablishment, we hear no end of fearmongering costs in 2010; a gure over and above the cost about socialism and how awful it would be if of health insurance premiums (Rukavina). health care became a public benet, like it is in many countries around the world. But the truth People will say that we cant aord universal is that Americans on Medicare and Medicaid are health care, that those of us who believe oth- much less likely to lay awake at night fearing that erwise are living a foolish dream. But they are the next medical procedure will force them into wrong. The dreamers have it right this time. bankruptcy or foreclosure. Its time to rethink Were not making an argument about aordabili- what obligations we owe to the young, what kind ty or appealing for the creation of what some call of promises we want to make to those who come the Welfare State. Were saying that it is time after us, and how we intend to keep them. to pay attention to the overwhelming evidence that for-prot health care is killing us. Its time Medical Debt and Bankruptcy to wake up from our national health care nightThe Insurance Hoax mare.

How long are we willing to stand under our worthless umbrellas and pray that it doesnt rain? Many health plans dont cover all the treatments for a serious illness or accident. Others limit the total amount of benets or require absurdly high deductibles, putting necessary care out of reach for people who believe they are protected (Seeing Red). According to the Access Project, a non-prot research and advocacy organization,

Eat The Young

ho is paying the price for our profit-based system? It may be obvious that low-income people pay a higher percentage of their income for health care. But the young are also at a high risk for incurring medical debt. This is because those from the ages of 19 to 29 are more likely to lack health insurance than older Americans. Many low-wage employers that hire young adults do not provide coverage, and since the 2008 nancial crisis, new college graduates have disproportionately high rates of unemployment and underemployment. Through a toxic combination of college loans, medical debt, and a recession caused by banks, many peoples nancial lives are ruined before DEATH BY FOR-PROfIT HEALTH CARE

ankruptcy is often presumed to be the result of proigate living by consumers who overspent on luxury items. Dont live beyond your means is common advice, as if personal responsibility is the only thing that matters in an economy that almost collapsed only 5 years ago. In fact, people are being forced into bankruptcy in America because they had the audacity to get sick without millions of dollars in the bank. Or, they believed their private health plan would protect them from the worst. By the time many realize that for-prot health care is a hoax, its too late. The crisis is gaining steam. Just 30 years ago, debtors rarely led for bankruptcy as a result of a medical problem. Today, an astonishing 62% of personal bankruptcies are linked to medical debt. The link between medical debt and bankruptcy also shatters the myth of personal responsibility A STRIKE DEbT REpORT

that makes many of us feel as if we are to blame if we cant aord basic needs. According to a report in the American Journal of Medicine, most people who declare bankruptcy as a result of medical debt had insurance at the time they incurred the debt (Himmelstein). Furthermore, the majority of medical debtors who declared bankruptcy attended college, owned their own home, and had middle-class jobs. They did everything right, yet they were still nancially devastated when a member of their family got sick or had an accident. You might think that a sharp uptick in the number of medical debtors ling for bankruptcy would prompt the government to step in. After all, no one chooses to go into medical debt. Yet, our delusional Congress assumed people were abusing the bankruptcy law when their lives were turned upside down by an unexpected medical expense. In 2005, Congress enacted the Bankruptcy Abuse Prevention and Consumer Protection Act which made it even more dicult for people to le for bankruptcy. During this same period, the number of under-insured grew from 15.6 million people to 25.2 million (Himmelstein). To sum up the catastrophe: as a response to the rising cost of care and a growing number of Americans who cannot aord their medical bills, Congress responded by throwing up more barriers to bankruptcy. Its not that bankruptcy is a real solution, since it does not address the fundamental economic conditions that pushed individuals to bankruptcy in the rst place. The point is that our elected representatives are out of touch and out of time. They have little to oer us but moralizing and useless reforms. The only reasonable response is collective action to create a health care program that reimagines the meaning of care and puts people before prots.

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institutions that serve people in need to create a new market for the global investor class. There is no better example of a clueless ocial f you have ever needed medical care but didnt have insurance, you most likely went to a pub- who seems to reside on a dierent planet from lic hospital or clinic. There are approximate- his constituents than Louisianas Governor Bobly 1,131 public hospitals in the US (Fraze). These by Jindal. In 2012, Jindal proposed funding cuts institutions, which serve 75% more uninsured for the states health care programs to plug a patients than their private counterparts, are a $165.5 million budget gap. The impact on public vital resource for low-income and uninsured hospitals will be disastrous, forcing them to repatients. Yet, public hospitals are disappearing. duce the care they provide to Medicaid patients Like public schools, they have been swept up in and to those without insurance. Louisiana State a wave of privatization: the public sector is being dismantled to create new prot streams for the superrich, most of whom have never been to the local communities from which they are siphoning wealth. If your public hospital seems disorgaI had 30 minutes of outpatient surgery while nized and dilapidated, it is easy to assume that it I was uninsured. I fought the debt. I went is being mismanaged at the local level. Hospitals as high as you can go in the hospital hierhave also been caught up in the same global ecoarchy. I sent a registered letter to the CFO, nomic changes that are at the root of the rising reminding him that the hospitals nonprofit cost of care and ballooning rates of medical debt. status was based on offering a certain perHospital privatization is sweeping the councentage of charity care. I never received try, and states like New York and Louisiana are an answer from him. Instead, he had a leading the way. In early 2013, Governor Cuomo flunky send me a letter that said that I didnt announced a budget that would mark the begindeserve a discount at all. They refused to ning of the end of publicly-funded hospitals in adjust my bill to my familys income level. New York state. He is seeking to close Brooklyns Long Island College Hospital and Interfaith Anonymous, Indiana Medical Center and replace them with private versions (Frost). The property where the hospital sits is also being eyed by developers as a location for a luxury condominium (Lutz). Shuttering lich is a signicant step that has ramications University alone plans to lay o 1,495 hospital far beyond the fate of one institution. It would employees and cut services at seven hospitals set a precedent for turning public hospitals over across the state. Some buildings will simply be to the private sector, a move that Assemblywom- abandoned and left to rot (Shuler). Jindal is also an Joan Millman called troubling because pri- planning to restructure the states health care sysvate hospitals have a duciary responsibility to tem, turning several public hospitals over to the their stockholders, not their patients. In an era private sector. Private rms would receive public when tens of millions of patients are drowning dollars to run hospitals whose rst order of busiin medical debt and the number of uninsured ness is to earn returns for investors. Louisiana is on the rise, public ocials like Cuomo actual- State Sen. Francis Thompson openly declared ly believe the solution is to eliminate those few his opposition to the plan. Im afraid...we may DEATH BY FOR-PROfIT HEALTH CARE A STRIKE DEbT REpORT

Disappearing Public Hospitals

get picked like a buzzard does a dead animal, he said (Millhollon). Thompsons description is accurate. The public sector is a carcass being picked to the bone by private sector vultures. Privatization will deepen the debt crisis by forcing hospitals to focus on their credit rating, not patient care. As described below, credit rating agencies are already among the most powerful corporations in the world. Under threat of a reduced rating, hospitals will be under even more pressure to aggressively pursue medical debtors. They will also oer less care to low-income patients because the bond ratings of hospitals can be negatively impacted if hospitals provide too much charitable care. Yes, too much charitable care is a thing that exists in the world of Wall Street nance. When hospitals are privately nanced, bond rating agencies determine our future (Zieger). Another world is possible. Under a humane health care system, we would begin to ask which measures of success really matter. We would start with the big questions: what does it mean to live a healthy life and how do we get there together? But under Wall Streets inuence, hospitals are analyzed according to nancial metrics, such as debt per bed and local market competition. The threat of lower bond ratings forces hospitals to hire Wall Street consultants, to cut back on purchases of medical equipment, to postpone the hiring of medical personnel, and to lay o sta. Indeed, in New York City, an investment banker named Stephen Berger has been recruited to drive the nails into the cons of community hospitals in order to create more opportunities for Wall Street to make money (Benson). Debt starts a vicious cycle that keeps a hospital from focusing on patients. This is a kind of madness, a nightmare from which we must nally awaken.

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panies clean us out a second time by charging usurious interest rates and adding late fees to he madness extends beyond the walls of our accounts when we cannot pay. A report by the the hospital. Our cities and towns are being public policy group Demos, Borrowing to Stay sucked dry by Wall Street and by global in- Healthy, reports that vestors who demand a prot at any cost. In many Twenty-nine percent of low- and middle-incases, hospitals are responding to the crisis by agcome households with credit card debt regressively trying to extract money from patients. ported that medical expenses contributed to It starts before patients even leave the hospital. their current level of credit card debt. In 2012, the Minnesota Attorney General began an investigation of Accretive Health, one the largest medical debt collection rms in the coun- Reports like these illustrate the circular logic of try. Documents reveal that debt collectors were the debt spiral. When people cant pay doctor allowed into hospitals where they were indistin- bills, they often turn to other forms of credit, guishable from regular hospital sta. According which compounds the problem. Because health to the New York Times, such collectors routinely insurance is tied to employment, a serious medidemand [that patients] pay outstanding bills cal condition can limit a persons ability to work, and may discourage them from seeking emer- earn income, and remain on a health plan. Get gency care at all. This is a direct violation of a sick. Cant work. Lose health care. Go into debt. federal law requiring hospitals to provide care to Take on more debt. When medical debt leads to consumer debt, it anyone who needs it. In Minnesota, the mother of a child who needed surgery reported that col- can cause dire consequences. Health Aairs relectors hounded her for payment before her son searchers Robert W. Seifert and Mark Rukavina received care. She did not know the agents who explained that approached her were debt collectors. You really People with medical debt are often subject to feel hoodwinked, she said. These collection taclegal judgments, wage garnishment, attachtics are becoming business-as-usual. A for-prot ment of assets including bank accounts, or health care system means health care is a luxury liens on their homes, which can lead to foreenjoyed by those who can aord it. The rest of us closure. must beg, borrow, and endure harassment to get the services we deserve. The debt spiral doesnt stop with medical debt. It might be surprising that many medical debtors Once the bills pile up, studies show that people own their own homes. In fact, people with medborrow even more to make ends meet. As de- ical debt and those without have equal rates of scribed in the Debt Resistors Operations Manual, home ownership. But there is one important difpeople who cant aord medical care turn to ference: those with medical debt are more likely credit cards, the so-called plastic safety net, to to use their homes as collateral for loans or take pay for daily necessities (Zandt). Thus, credit out a second mortgage to pay the bills. There is card debt, often assumed to be the result of over- no better barometer of our time than the fact that spending by impulsive shoppers, is actually in- owning a home pushes us deeper into the debt separable from our for-prot health care system. trap. The capitalist dream has led us down a dark Insurance companies and investors make a kill- path. The future has been gambled away. Millions ing by withholding care, then credit card com- have tapped into retirement funds to pay medi-

The Debt Spiral

cal debt (Garcia). The debt spiralfrom medical debt to consumer debt to foreclosure and a dwindling retirement accountshatters the myth of personal responsibility. Debt is a rigged system of overlapping and mutually reinforcing types. For many, there is no exit.

Sickness can destroy you in America. Both my partner and I had full-time jobs when I got sick. Though we had insurance, we did not have family leave. When youre on chemotherapy six days per week, theres no way you can keep your job. Then, two years later, my partner got sick. Even though we had health care, a bad situation became a crisis. When our savings ran out, there was no safety net for us. Who has an emergency fund to last nine months? What if you have to tap it twice? We began living on credit cards. I think people have a lot of assumptions about how people get into credit card debt. For us, it was how we survived during the most difficult time in our lives. The fact is that insurance doesnt cover everything, and you cant work if youre sick. Even people with health care are affected by medical costs. Well be paying off our credit card debt into retirement. We cant save for our childs college or plan for the future. People who have insurance and a little money in the bank think nothing bad is going to happen to them. But what happened to us can happen to them too. It can happen to anyone. Anonymous, New York

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The Shame of Debt

Medical Debt and the Dystopian Nightmare of Credit Scoring

o be in debt is a shameful thing. Most of us have been made to feel like our debts are our fault, even though one in seven adults in the US is currently being pursued by a debt collector and more and more of us are in debt for basic necessities like housing, education, and health care. Medical debt is a source of shame that aects peoples overall health. Its quite simple, really. When people cant afford to see a doctor, they dont. Patients who cant aord to payor who have accrued medical debtare less likely to seek out care because they are ashamed about their debt and dont want to end up owing more (Consequences). This ultimately leads to more health problems and increases the costs of care. A study in the Journal of General Internal Medicine showed that Over two-thirds of those who either had a current medical debt or had been referred to a collection agency reported that it caused them to seek alternative sites of care or to delay or avoid seeking subsequent care when needed.

When Republicans in Congress invented a boogeyman called death panels during the 2008 presidential campaign, they werent talking about the for-prot health care industry. But they should have been. One report showed that 45% of medical debtors put o necessary care to avoid debt (Garcia). The US health care system is making people sick and keeping them that way because illness is protable (Jacoby). Is that the kind of health care system we want? Is that the kind of world we want?

f youre wondering why you have a low credit score or why you never seem to qualify for the lowest interest rates on home, car, or other loans, the problem may be medical debt. This is true even if you paid an overdue medical bill. The Federal Reserve has shown that more than half of all collection accounts that negatively impact credit reports are medical debt (Avery). This is a result of the fact that health care costs are on the rise and tens of millions are uninsured. But it is also because medical debt is treated dierently from other kinds of debt. Private health insurance reimbursement is incredibly cumbersome. Dierent benets are often covered by dierent companies and at dierent rates, leading to a lengthy, circuitous billing process that often leaves patients holding the bag. If you have ever received a medical bill that you didnt understand or that you thought your insurance was supposed to cover, you have been caught up in this Kafkaesque system. If you have ever received a letter from a health care provider stamped with the notice This Is Not A Bill, or if you have signed a form at a doctors oce promising to pay anything your insurance fails to cover, you have been an unwitting victim in the tangled web of medical billing, an industry that thrives on patient and health care provider confusion. According to Rukavina, One study found that nearly one-third of respondents let a medical bill go to a collection agency because they did not understand the bill or explanation of benets statement. Another study estimated 14 million American adults said that a medical bill was sent to a collection agency because of a billing mistake.

Confusion is the grease that keeps the wheels of the medical collections industry turning. Its hard not to think that billing mistakes may not be mistakes at all but part of an intentional strategy to keep patients in the dark and in the red. In addition to patient confusion, Rukavina has found that medical debt is more likely to end up in collection because hospitals routinely sell medical debt to debt collectors after 60-90 days of nonpayment, far less than the customary 180 days for other kinds of debt. Health care providers rarely report paid medical bills to the credit reporting agencies. So, even if you are billed in error, your health care provider may send your bill to a collection agency before you can dispute the charge (Bernard). Once in default, a medical debt stays on a credit report for up to 7 years, even if you pay the bill. Research by the Commonwealth Fund shows that, in 2010, 9.2 million people wound up in default on a medical bill because of a billing mistake (Help). These mistakes have serious consequences. According to evidence obtained by the Access Project, a single paid medical bill can lower a consumer credit score by as many as 80 points. That means you will pay a higher interest rate for almost anything else you want to buy on credit, including a home or a car. The fact that a relatively small medical bill can end up costing thousands in interest charges down the line demonstrates the obscene power of the credit rating agencies. Consumer protection attorney Robert Nahoum told Strike Debt: Ive never seen three companies with more power over the American consumer than the top three credit reporting agencies, Equifax, TransUnion, and Experian. Theres very little consumers can do. If patients are powerless, so are many health care providers. Its important to note that your doctor may be just as confused as you are. Strike Debt has PAGE 6

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talked to health care workers around the country, and they tell us that they are as frustrated as patients when it comes to medical billing. Why do insurance companies and ratings agencies have so much power over our lives? Why do we live in such perpetual confusion? These questions are important to ask when we think of what it means to be healthy and what kind of economy we need to sustain life. We might also ask why our elected ocials dont put a stop to predatory medical billing and curb the power of the ratings agencies. The Medical Debt Relief Acts attempts to prohibit credit reporting agencies from listing medical debts on credit scores. Yet, even this minor reform has little chance of passing because the credit rating agencies and insurance companies are a powerful lobby in Washington. And even if the mdra were to make it through the Senate, it only applies to paid medical bills. As usual, Congress lacks the political will to challenge the power structure that puts people in debt and keeps them that way. Debt is a tool of capitalist exploitation, and we cant eliminate the debt without rethinking the larger economic system. Indeed, the evidence actually indicates that if we dont act things will get worse for patients and debtors before they get better. fico has begun developing a special ratings system to rank potential patients on how likely they are to pay their medical bills (Gipson). Like having a bar code tattooed on your forehead, we could be looking at a brave new world in which your credit rating determines not only whether you can obtain a credit card but whether you receive medical care when you get sick.

va). And, this year, hca was ordered to pay a $162 million ne for failing to make agreed-upon reo one disputes that our health care system pairs to run-down hospitals in Missouri as well is for prot. But whose prot? Patients as for reneging on a promise to provide charity are certainly losing the health care battle. care to low-income patients. Who is proting from this criminal activity? Theres a tendency to attribute [the high cost of care] to minorities or those with severe health hca, which was founded by former Senate majorproblems, Matthias Rumpf of the Organization ity leader Bill Frists family, is primarily owned for Economic Co-operation and Development by Bain Capital, the private equity rm founded by Mitt Romney. Bain investors are not turned has explained. Actually, the evidence shows that o in the least by how hca treats patients. In fact, according to the New York Times, Even Americans with health insurance and those who have the highest education and The nancial performance has been so imincome levels fall behind their counterparts pressive that hca has become a model for in other parts of the world (McHaney). the industry. Its success inspired 35 buyouts of hospitals or chains of facilities in the last It is clear that insurance companies, global intwo and a half years by private equity rms vestors, and credit ratings agencies are reaping eager to repeat that windfall (Creswell and a massive windfall. Proteers are descending on Abelson). the health care industry from all corners of the nance world. One of the largest and most profitable health care providers, hca, runs 163 hospi- In a private health care system, nothingnot tals across the country. The company is also un- fraud or patient abuse or crumbling buildings der investigation by the Justice Department for interferes with the relentless drive for corporate defrauding Medicare by performing unneces- prot. In fact, the same private equity rms that sary heart surgeries on unwitting patients (Kole- control many hospitals also have a stake in debt collections companies. This means that companies like Bain Capital that own the hospital networks that put us into debt also invest in many of the rms that try to collect that debt from us. At the root of the medical debt industry is our Once the web is spun, theres no way the 1% can for-profit health care system. A few people lose. are getting very rich from others illness and Most of us are focused on daily life: trying to injury. Medical debt buyers are the bottom earn enough to put food on the table and care feeders of the industry. But if you follow the for the people we love. We lay awake at night wormoney from patient care to medical billing rying about a sick child and pray our insurance and collections, youll find that hedge funds policies will protect us if tragedy strikes. Wall and other investors are included in the ones Street knows that few people have the luxury of really cashing in. paying attention to whats really going on in their boardrooms. That is why it is more important Robert J. Nahoum, Esq. than ever to change the conversation about medConsumer Protection Attorney ical debt and our for-prot health care system.

Who Prots from Medical Debt?

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Wont Obamas Aordable Care Act Reduce Medical Debt?


he fact that many liberals greeted the passage of the Obama administrations health reform law with such delight is downright shocking when we consider its glaring inadequacies. In 2014, states will be required to create exchanges in which people can purchase private insurance. But, as pnhp physician Margaret Flowers has explained, the majority of these plans will not oer full coverage. And people who purchase insurance through an exchange will end up with plans that cover 70% or less of the cost of health care. Since even a short hospital stay can cost tens of thousands of dollars, the math is not on the side of people who dont already have huge bank accounts. Insurance companies prot by denying coverage. Now, thanks to the Aordable Care Act, that strategy will be codied into law. Insurance companies will also gain access to a whole new market for their products while oering worthless umbrellas in return. It gets worse. The federal subsidy that is supposed to help people purchase health insurance under the new law only applies to individuals, not families. So, depending on your income level, if you want to purchase coverage through an exchange, youll be left with two options: pay market rate for private insurance or go without. The people who will benet from an expansion of our market-based insurance system are not patients. Instead, the 1%, who already control the prot-driven health care system, will get a payout every time the rest of us see a doctor. Most appalling, however, is that more than 20 million people will not be covered under the new law (Babcock). It makes no sense to expand a failed market and demand that people participate in it, especially when we already have evidence that such reforms dont work. In Massachusetts, for example, health care reform did not stem the tide of bankruptcies linked to medical debt (HimmelDEATH BY FOR-PROfIT HEALTH CARE

or-prot health care kills. In 2007, in Prince Georges County, Maryland, a twelve-yearold boy named Deamonte Driver died from a toothache. He had an infection, but his mother could not aord to take him to a dentist (Otto). Deamonte lost his life because he did not receive antibiotics that would have cost $80. This is the world we live in today. What kind of world do we want? Universal, single-payer medical care would be a short-term step in the right direction. But its not the ultimate solution. State-nanced care would give us, above all, a chance to take a step back from the relentless bills and the anxiDr. Akoma, Robert Wood ety that comes from not knowing if well be able Johnson Medical School to aord to care for ourselves and our loved ones. It would give us a chance to ask if there are realstein, Medical). There is simply little evidence ly only two choices: private or public, corporate that the aca will do much beyond worsening an or federal. It would give us, at long last, what we already grave labor crisis. Reports are emerging really need: the freedom to ask larger questions that employers, especially colleges and univer- about the meaning of health and how we can sities, are planning to cut employees hours in work together to provide it to ourselves, to our order to avoid oering health benets under the families, and to those who come after us. We have a dicult road ahead. But there is aca (Zorn). Considering what we know, the fact that many treated the passage of the aca as a pro- no doubt that the private insurance industry gressive victory seems like magical thinking. As is wholly inadequate to the task. Our lives are A STRIKE DEbT REpORT PAGE 8

I practice medicine at a hospital in New Jersey. We care for a lot of patients who dont have health insurance. Many low-income people cant afford private insurance, but they make too much to qualify for Medicaid. Recently, I diagnosed a woman with diabetes and cervical cancer. Originally from Africa, she has lived in the US for 15 years. But she never received regular medical care because she could not afford insurance. Now she is in real trouble. Another patient who does qualify for Medicaid has diabetes. But he needs to see an eye doctor. I cant refer him because most specialists do not accept Medicaid. What are these patients supposed to do? Our for-profit health care system is literally killing people. The Obama administrations health care reform initiative, the Affordable Care Act, will help if it is implemented correctly, and if states dont cut corners. But its not the ultimate solution. Id like to see a system where people pay a percentage of their income to fund national health insurance for all. The people with more should pay a little more. In the most prosperous country in the world, no one should go to bed hungry and no one should die of an illness because they dont have health insurance.

Flowers noted, public relations and marketing expenses account for more than one-third of the cost of care. Even the decit-crazed political establishment seems to be suering from willful blindness. According to the Washington Post, if we had the per-person health costs of France or Germany, two countries with publically-funded health care, Americas decits would vanish (Klein). Its time to follow the money and its time to get real. According to research conducted by Physicians for a National Health Program, a single-payer system could save $400 billion per year. Yet politicians focused on decit reduction would sco at the suggestion that we publicly fund health care in America.

Life or Debt?

in jeopardy because medical care in the US is a Flowers, Margaret. Saving on Health Care at the Cost Millhollon, Michelle. Budgets of Public Hospitals of Peoples Health. Al Jazeera. 27 Feb 2013. Depend on Privatization Agreements. The Advoprot-making enterprise that enriches the few at cate. 25 Feb. 2013. the expense of the rest of us. Reform wont do in Fraze, Taressa, et al. Anne Elixhauser, Laurel Holmthe long run. Politicians do not have the will to quist, and Jayne Johann. Public Hospitals in the Otto, Mary. For Want of a Dentist. The Washington take the necessary steps. As Dr. Stee WoolhanUnited States, 2008. Healthcare Cost and UtilizaPost. 28 Feb. 2007. dler of pnhp makes clear, tion Project, September 2010. Rukavina, Mark. Medical Debt and Credit. Suolk Its not your fault if youre in debt and its particularly not your fault if youre in debt because of a medical problem. This is unfair. No other developed nation forces people to go into debt because they get sick (Time To End).
Frost, Mary. Gov. Cuomos For-Prot Hospital ProUniversity Credit Symposium, June 2012. posal Worries Hospital Workers and Local Reps. Seeing Red: The Growing Burden of Medical Bills Brooklyn Daily Eagle. 4 Feb. 2013. and Debt Faced by US Families. The CommonGarcia, Jos and Mark Rukavina.Sick and in the Red: wealth Fund. Vol. 42. 20 Aug 2008. Medical Debt and its Economic Impact. Demos Seifert, Robert W. and Mark Rukavina. Bankruptcy and the Access Project. is the Tip of a Medical Debt Iceberg. Health Aairs.

The situation we face is not our fault, but its our job to take a stand together. The only real solution is a bottom-up, grassroots movement that puts people before prots. It will not be given to us by benefactors or by politicians who depend on Wall Street funding for reelection. Its up to us. Himmelstein, David U, and Deborah Thorne and The time is now. Its life or debt. Elizabeth Warren, and Stee Woolhandler. Med-

Gipson, Kevin. Is Fair Isaac Back Pedaling on the 28 Feb. 2006. Medical FICO score? Bankruptcy Law Network. Shorter Lives, Poorer Health: Panel on UnderstandHelp on the Horizon: How the Recession Has Left ing Cross-National Health Dierences Among Millions Without Health Insurance and How ReHigh-income Countries. National Research form Will Bring Relief. The Commonwealth Fund. Council and Institute of Medicine of the National 16 March 2011. Academy. 2013. Shuler, Marsha. lsu Plans to Lay O 1,495 Hospital Employees. The Advocate. 6 Oct 2012.

This Strike Debt report is dedicated to the memory of Deamonte Driver


Sources
Avery, R. et al, An Overview of Consumer Data and Credit Reporting, Federal Reserve Bulletin, Summer 2003 Babcock, Charles R. Uninsured Americans Get Hit With Biggest Hospital Bills. Bloomberg News. 11 March 2013. Benson, Barbara, NY to Address Troubled Brooklyn Hospitals. Crains. 28 June 2011. Bernard, Tara Siegel, Discrepancies on Medical Bills Can Leave a Credit Stain. New York Times. 4 May 2012. The Consequences of Medical Debt: Evidence from Three Communities. The Access Project, Feb. 2003. Creswell, Julie and Reed Abelson. A Giant Hospital Chain is Blazing a Prot Trail. New York Times. 14 Aug 2012.

Kane, Jason. Health Costs: How the U.S. Compares With Other Countries. PBS online, 22 Oct. 2002.

ical Bankruptcy in the United States, 2007: Results State Trends in Premiums and Deductibles, 2003of a National Study. The American Journal of Medi2011: Eroding Protection and Rising Costs Undercine. 2009. score Need for Action. The Commonwealth Fund, Jacoby, Melissa. Does Indebtedness Inuence December 2012. Health? A Preliminary Inquiry. The Journal of Law, Time To End Medical Debt, Medical Bankruptcy. Medicine, and Ethics, 30. (2002): 560-571. Physicians for a National Health Program, March 16 2013. Young, Jerey. High Deductible Health Insurance Pinches Workers From Both Sides. Hungton Post, 20 Feb 2012. Zandt, Deanna. The Myth of Credit Card Abuse and Bankruptcy. AlterNet. 17 Oct 2005. Zeldin, Cindy and Mark Rukavina. Borrowing to Stay Healthy: How Credit Card Debt is Related to Medical Expenses. Demos, 2007. Zieger, Anne. Moodys Downgrades 18 Hospital Bond Ratings in Two Months. Fierce Health Finance. 17 Dec. 2008. Zorn, Eric. Teachers, Colleges, Getting an Early Lesson in Obamacare. Chicago Tribune. 6 March 2013.

Klein, Ezra. Why an MRI Costs $1080 in America and $280 in France. Washington Post. 15 March 2013. Koleva, Gergana. Largest U.S. Hospital Chain Probed for Medically Unnecessary Heart Procedures. Forbes. 6 Aug 2012. Lutz, Jaime. Second Opinion: State Now Admits lich Real Estate was on the Table. The Brooklyn Paper. 14 March 2013. McHaney, Sarah. Americans Far Less Healthy, Die Younger than Global Peers, Stuy Says. PBS. 9 Jan. 2013.

DEATH BY FOR-PROfIT HEALTH CARE

A STRIKE DEbT REpORT

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