Medical Debt: Because Getting Sick Shouldn’t Be a Financial Diagnosis

Getting Sick Shouldn’t Be a Financial Diagnosis

What an outstanding experience and learning opportunity put on by the Lown Institute on May 15, 2025 in Washington DC

Medical Debt in America: A Research and Policy Forum

From start to finish, this conference was filled with insights, great speakers, riveting discussions, and evidence of real change and positive impact brought by many to the area of Medical Debt
From the opening welcome by Dr Vikas Saini, who captured what I would think is a universally held point of view:

“When [you are] sick, we should not be worrying about access to healthcare in our most needy moments.”

With the latest data released by estimates range, but somewhere in the order of 95 million people (around 22% of 18-65 year olds) suffer some form of medical debt. While the definition of what constitutes “Medical Debt” continues to be debated, I would suggest that if you owe money for healthcare, and/or avoid accessing care or treatments because of cost, then you are in some form of medical debt. As Vikas said, when it comes to healthcare, it is not a Democrat or a Republican issue; it is an issue for all of us.

In a recent exchange with my friend and colleague Kendall Smith, we discussed our own experiences and fears, and as he put it, “the safety net in this country is barely a net at all. You can do everything ‘right’ and still end up one step away from the edge. It’s a lot — and you’re not alone in feeling it.”

This is, as Dr Saini called it:

“Moral stain on the fabric of the country”

The Silent Pandemic No One’s Talking About (But Should Be)

What follows is a summary of some of the highlights and insights gleaned from a day of discussions, presentations, and dynamic exchanges with the attendees and participants. Please forgive any omissions or errors as I capture a small sprinkling of the content

The first panel with
Fred Cerise, Parkland Health
Patricia Kelmar US PIRG
Dave Shuster, Horizon Goodwill Industries

Offered some real-world experiences to limit the harm of medical debt. At Horizon Goodwill Industries, there were some standout actions that others could potentially use
They asked their employees to send their claims to their benefits department instead of leaving the ill-equipped individual to fight these bills
As part of their work to increase prevention, they had their local primary care providers come to local town halls to introduce themselves, answer questions, and explain the benefits of primary care and prevention (not surprisingly increasing sign-up and participation)
For the local hospitals that they contract with, they added local executives from these organizations to their board so they could experience what their customers are experiencing, which had them quickly understand what challenging issues are faced by the very people they want to serve

In our Second Panel we got to look at the data and the evidence with:
Chris Goodman Univ of SC
Fred Blavin, Urban Institute
Kelsey Chalmers, Lown Institute
Noam Levey, KFF Health News
Matthew Rae, KFF

The clear message here was that the data tells stories, and we saw some of the early output from the
Urban Institute that showed 77 of 100 counties with the most medical debt are in states that had no Medicaid expansion, and an additional 12 were States that took the Medicaid expansion some years later. But perhaps the most telling insight was that the biggest predictor of medical debt was the general health state of people in the county. So healthier counties had less debt, and counties with people in poorer health had more debt.

The widely varied approach to financial assistance was eye-opening, with the average set to about 200% of the Federal Poverty Guidelines (FPG), but the impact in each community was highly variable, depending on what the average income was for the community area

Based on the data analyzed, some 3 million people have more than $10,000 of medical debt at any one time.

Despite some regulations that are designed to stop medical debt from being reported to credit reporting agencies, there was discussion of this action still being taken by some 30% of hospitals

The work to gather and collate this was mostly manual requiring individuals to go to each of the facility’s sites and then find their policies and download them for analysis, which got me thinking that perhaps this is a great project for an AI tool to go off, seek out the sites and data and then perform an automated data analysis to automatically collate and keep this report up to date

You can download your own collection of this data here. But the fact that the vast majority of people with medical debt have medical insurance gave me the most pause

Artificial Intelligence

While Artificial Intelligence was not addressed directly the concern came up during many discussions and as has been well documented by many, including ProPublica and the great work by David Armstrong and colleagues: How Cigna Saves Millions by Having Its Doctors Reject Claims Without Reading Them. My thanks to Eva Marie Stahl for highlighting the excellent reporting by 404 media to highlight one of the recent additions crammed into the bill to limit any oversight or regulation of AI. The Budget Reconciliation Bill, which was stuffed with new language courtesy of Congressman Brett Guthrie of Kentucky, Chairman of the House Committee on Energy and Commerce, was designed not only to stop any regulation but also to limit the states from enacting any regulation or limitations on this technology:

No State or political subdivision thereof may enforce any law or regulation regulating artificial intelligence models, artificial intelligence systems, or automated decision systems during the 10-year period beginning on the date of the enactment of this Act.

Hospitals vs. Wallets: The Fight We Didn’t Sign Up For

The Panel on Hospitals and Medical Debt was made up of

Noam Levey
Fred Cerise
Connor Coursey
Dr Deepak Manmohan Goyal
Eli Rushbank
Eva Stahl

I was interested to hear that in one instance, the organization has an anthropologist on staff who captures and reports patient stories of the positive impact every Thursday to the organization. This theme of telling stories to get the message across to everyone filtered throughout the panels and the conference. And we heard the impact that was life-changing for one woman who had $700 of medical debt wiped out.

Naturally, there was discussion around potential abuse of the system and providing easy access to removing the debt, taking away the threat of enforcement by removing the option of reporting to the credit agencies. However, those with direct experience reported here and in other panels that this was categorically not true, and as one panelist stated

No one gets up in the morning thinking how can I go to the hospital and get myself a fun colonoscopy for free

The status of many charitable hospitals are receiving renewed focus and attention from news coverage, and various approaches to push better behavior. While naming and shaming can highlight bad actors, it also creates a siege mentality, and no matter how we approach these problems, we need everyone to participate if we are ever to solve these systemic issues for the benefit of everyone. The balance seemed to be around the concept of transparency and reporting of data and identifying the good and bad actors working both visibly and behind the scenes

The afternoon panels opened with How States are Taking on Medical Debt was offered by:
Anthony Wright – Families USA
Elisabeth Benjamin – Community Service Society of NY
Manasi Kona Georgetown University Center for Health Insurance Reform
Julia Lerche, NC Dept of HHS
Luvia Quiñones Illinois Coalition for Immigrant & Refugee Rights

The participants had great stories and experiences to share that offered pathways for State action in addressing these issues. New York had clearly had some notable successes, including mining the court records to show who and where individual facilities were taking court actions and then lining up the data on defendants correlated with Zip codes, which demonstrated a clear pattern by one facility to go after people of color and lower income. This included taking action against 12 individuals who were currently in jail!

The power of storytelling came up again and tapped individuals, both as patients and legislators, who helped with getting the word out and a subsequent groundswell of support for real change and legislative actions.

A central theme was the fundamental design of insurance with deductibles, which is forcing people into medical debt. This came up later in the day when we talked more about international comparisons provided by the Commonwealth fund, where other countries either don’t report medical debt because the term is anathema or if they do it is only for smaller and manageable amounts

If I were routing for one specific piece of regulation it was the passage of the “No Blank Check” Act which would require patients to receive an estimate for the care before they receive it that actually has meaning and not just as it currently is in many cases a random set of numbers put on a piece of paper that bears no relevance to any bill received after the care has been delivered

The penultimate panel on Federal Pathways for Change was missing one participant who was pulled away thanks to the massive reconciliation project underway that was also the subject of plenty of discussion. The panel was hosted by Vikas and he was joined by
Blair Elliot Third Way
Michelle Sternthal, Community Catalyst

With a lot of uncertainty in legislation currently, the various avenues open were somewhat limited, but some stand-out moments include the data out of New York, revealing that somewhere between 1/2 to 1% of denials are appealed and the majority of these appeals are upheld to the tune of $3 Billion. In addition, many of the cases that are not appealed often lead to medical debt.
For my physics advisors, colleagues who, in light of the above statistic, are more like Super Heroes every day as they fight these appeals, mostly for their institution, but ultimately for the

The final panel sought out Long Term Medical Debt Solutions and featured
Berneta Haynes, National Consumer Law Center
Ge Bai, Johns Hopkins
Sara Collins, Commonwealth Fund
Ed Weisbart, Physicians for National Health Program
Wes Yin, University of California LA

While we have many people insured I do not hear much about being ‘underinsured’ but if you consider this is a relatively low bar many will find themselves in the under-insured category
If 5% of your gross income is less than your deductible for the health insurance you have then you are underinsured

Compare that to the mandated levels in Germany, which fix nationally the ceiling for out-of-pocket costs for the general population is 2% of your income, and this is lowered to 1% if you suffer from any chronic conditions.

Billing Staff Outnumbering Beds? The Math of America’s Medical Madness

But for a jaw-dropping statistic, this was the winner for me

There are approximately 900,000 inpatient beds in the United States
In the United States, there is a one-to-one ratio of billing staff to beds, and in the case of one hospital cited, they have 1,600 billing staff for 800 beds. For comparison, the University of Toronto has approximately the same number of beds, and they have a complement of 8 billing staff

I was especially intrigued to hear from Ed Wesibart and the Physicians for National Health Program. That offered some practical steps and approaches to fundamental change in the healthcare delivery system.

Your Incremental Learning Points

• Get to the data and show your work
• Bring the whole community with you
• Help people understand by telling stories
• Success is possible if at first, you don’t succeed – well, you know…try again, and again
• Look to others for ideas and approaches – plagiarize the hell out of solutions, and quickly