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Even Americans with health insurance can recover from a medical emergency that can leave long-lasting financial scars.
In a study published this month in the journal Health Affairs, researchers found that 18 months after being hospitalized for a traumatic injury such as a car accident or fall, the proportion of patients with medical debt in collections increased by 5.2 percentage points, or 24% relative to before the medical emergency. During the same period after injury, the average balance in collections increased by $290, and one in 10 patients owed more than $4,480.
The researchers found that the number of bankruptcy filings also increased by 3.2 per 1,000 patients approximately 15 months after injury, a relative increase of 6%.
“This study grew out of my clinical experience as a trauma surgeon and watching acutely injured patients cry out for treatment because they were worried about the bill,” said co-author Dr. John Scott, associate professor of surgery at the University of Washington.
Researchers examined the credit reports of nearly 13,000 trauma patients from one year before they were hospitalized for their injuries to 18 months after they were hospitalized. Credit report data is from 2018 to 2021. Almost all patients in the cohort, or 98%, had health insurance.
“Insurance reduces the risk of financial catastrophe, but the way private insurance is currently designed leaves many people at significant risk if something major happens,” Scott said.
The study results come at a time when health care costs are becoming a burden for many Americans amid widespread affordability concerns. A recent poll by KFF, a nonpartisan health policy research organization, found that two-thirds of Americans surveyed, or 66%, are worried about paying their medical bills, more than other household necessities such as utilities, groceries, groceries, housing, and rent.
Lawmakers have allowed the Affordable Care Act’s enhanced market subsidies to expire at the end of 2025, which is expected to lead to a surge in the number of uninsured Americans and people with higher deductibles before health insurance is available.
Regarding the economic impact of injuries, Scott said, “The numbers are going to get even worse as people get less insurance or are uninsured altogether.”
Patients may incur debt before insurance coverage begins.
Although the ACA expanded health insurance coverage to millions of Americans, many private plans come with high deductibles, requiring thousands of dollars in payments before coverage is available, Scott said. According to KFF research, the average market deductible in 2026 is $5,304 for a silver plan and $7,186 for a bronze plan.
“If you have an unexpected injury, you could end up paying thousands of dollars out of pocket before insurance pays out,” Scott said.
Caitlin Donovan, senior director of the National Patient Advocacy Foundation, said the study was alarming to find that “private insurance is completely failing to protect people from debt and bankruptcy.”
“This study highlights the need to build in additional protections into private insurance by limiting deductibles and incorporating income-based limits on out-of-pocket costs,” she said.
The researchers found that trauma patients on Medicare and Medicaid experienced different outcomes, with minimal subsequent changes in medical debt or bankruptcy. Scott said that’s likely because Medicare spending is often capped, while Medicaid requires minimal out-of-pocket costs.
“If insurance is supposed to protect against financial ruin after a health shock, Medicaid has done that job,” Scott said. “For many people, private insurance just wasn’t it.”
