A new report released today by the U.S. Department of Health and Human Services (HHS) shows that few families without health insurance have the financial assets to pay potential hospital bills. On average, uninsured families can only afford to pay in full for approximately 12-percent of hospital stays they may experience – and even higher income uninsured families are unable to pay for most potential hospital stays. Hospital stays for which the uninsured cannot pay in full account for 95% of the total amount hospitals bill the uninsured.
This is an issue that we at Health Access has focused on, leading to the passage of legislation to help the uninsured deal with hospital bill. Advice for those with hospital bills can be found at the website http://www.hospitalbillhelp.org/.
But the point of the study seems to be to explode the myth that the uninsured just get hospital care anyway. While hospitals do have to take people in an emergency to stabilize them, they are not under an obligation to provide preventive, ongoing disease management, cancer treatment, or any other form of non-emergency care. And even for emergency care, the hospitals send a bill–and it’s typically the largest bill (with the possible exception of a mortgage) that anybody will get in their life.
On releasing this study, HHS Secretary Kathleen Sebelius said:
“One of the most enduring myths in American health care is that people without health insurance can get care with little or no problem. Nothing could be farther from the truth. The result is families going without care – or facing health care bills they can’t hope to pay. When the uninsured cannot afford the care they receive, that cost must be absorbed by other payers. This is why expanding access to affordable health insurance under the Affordable Care Act is so important.”
Approximately 7 million Californians are uninsured. The report found that most uninsured people in America have virtually no savings. In fact, the median financial assets for all uninsured families are just $20. Even among higher income families, assets are low. Half of families with income at 400-percent of the Federal Poverty Level (FPL), or $89,400 a year for a family of four in 2011, have financial assets below $4,100.
Every year, nearly 2 million uninsured Americans are hospitalized. With 58-percent of these hospital stays resulting in bills of more than $10,000, most uninsured people are unable to afford potential hospital bills. Even the top 10-percent of uninsured families with the most assets are estimated to be able to pay the full bill for only half of potential hospital stays. Uninsured families can, on average, afford to pay the full bills for only about 12-percent of the hospital stays they might experience, bills that account for just 5-percent of the total amount hospitals bill them.
The high cost of hospitalization means that lacking health insurance poses a greater risk of financial catastrophe than lacking car insurance or homeowner’s insurance. Although people are 50-percent more likely to have car accident than to be hospitalized in a given year, the average bill for a hospital visit is over two and a half times higher than the average loss for a car accident. And, while the bill for a single hospitalization is about the same as the average loss from a house fire, a person is ten times more likely to be hospitalized than to experience a house fire.
The report can be found at http://aspe.hhs.gov/health/reports/2011/ValueofInsurance/rb.shtml.