USA - Most Bankruptcies Due to Medical Expenses

Arno Froese

The study, led by Dr. David Himmelstein, Distinguished Professor at the City University of New York’s (CUNY) Hunter College and Lecturer at Harvard Medical School, indicates that about 530,000 families each year are financially ruined by medical bills and sicknesses. It’s the first research of its kind to link medical expenses and bankruptcy since the passage of the Affordable Care Act (ACA) in 2010.

Himmelstein and his multidisciplinary research team—which included two doctors, two lawyers, and a sociologist from the Consumer Bankruptcy Project—surveyed a random sample of 910 Americans who filed for personal bankruptcy between 2013 and 2016. They found that medical bills made up 58.5% of bankruptcies, and illness-related income losses contributed to 44.3%, with many of the debtors citing both as causes of bankruptcy.

“Even the best job-based health insurance often vanishes when prolonged illness causes job loss—just when families need it most. Private health insurance is a defective product, akin to an umbrella that melts in the rain,” says Himmelstein.

“In the Supreme Court’s words, bankruptcy is a fresh start for the ‘honest but unfortunate debtor.’ Our study shows that for many bankruptcy debtors, the misfortune continues to come from the way we pay for health care,” says co-author Robert M. Lawless, the Max L. Rowe Professor of Law at the University of Illinois College of Law. “Bankruptcy may provide a fresh start, but it comes at a high financial and emotional cost for those who file. Filing for bankruptcy can stop the financial bleeding that the health care system imposes, but curing that system’s ills is the only lasting solution.”, 12 February 2019

Arno's commentary

Most wealthy countries spend about half as much on healthcare as does the United States. Example: the average annual healthcare cost is listed as $10,224 in the US, but only $4,543 in Australia, according to 2017 National Health Expenditure data. While Australia spent less than half on healthcare, their report card is significantly better than the US. Infant mortality per 1,000 births is 4.2 in Australia and 5.7 in the US. Life expectancy in Australia is 82.4 years, compared to 80.1 years in the US. Hospital beds are 3.8 per 1,000 in Australia, and only 2.9 in the US. In virtually all industrialized countries, the healthcare system is based on government-controlled insurance providing universal care for all.

So, why such tremendous differences? One may point to one word: lawyers. Watching US television, there is an abundance of advertising for personal injury by law firms; most promise excessive financial compensation for the client injured. Thus, health-related bankruptcies are not a surprise. That has been historically true for the US.

However, it means little to nothing when compared to eternity; the bottom line is still the same: “…it is appointed unto men once to die, but after this the judgment” (Hebrews 9:27). Regarding life expectancy, Psalm 90:10 reads: “The days of our years are threescore years and ten; and if by reason of strength they be fourscore years, yet is their strength labour and sorrow; for it is soon cut off, and we fly away.” Rich and poor, they all die, but there is one major difference, as recorded in John 3:36: “He that believeth on the Son hath everlasting life: and he that believeth not the Son shall not see life; but the wrath of God abideth on him.”

Arno Froese is the executive director of Midnight Call Ministries and editor-in-chief of the acclaimed prophetic magazines Midnight Call and News From Israel. He has authored a number of well-received books, and has sponsored many prophecy conferences in the U.S., Canada, and Israel. His extensive travels have contributed to his keen insight into Bible prophecy, as he sees it from an international perspective.

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