Insured Employees Struggling to Pay Medical Bills

Another survey finds wages not keeping up with workers’ growing out-of-pocket health expenses.

Having employer-based health insurance is no guarantee that workers won’t be sunk financially by their medical bills.

That hypothesis was supported by yet another survey that found that 37 percent of workers who have health coverage through their employer are having financial difficulties because of medical bills or know someone who is having financially difficulties because of medical bills.

The survey of 1,010 adults and another 573 adults with employer-based health insurance was conducted by KRC Research, a Washington-based public opinion polling service, and sponsored by Securian, a St.Paul-based company that sells supplemental group health insurance.
Of the 573 adults with employer-based health coverage, 31 percent said they have paid or know a family member who has paid unexpected out-of-pocket medical expenses in the past five years because of a critical illness like cancer, a heart attack or a stroke. Of those with unexpected expenses:

  • 61 percent said the costs were manageable
  • 27 percent said the costs set them back financially
  • 12 percent said they couldn’t afford the costs and have not yet paid their medical bills

Assuming $5,000 in unexpected out-of-pocket medical expenses, the most frequently cited method of paying off their medical bills was from personal savings (28 percent). That was followed by credit card (12 percent), health savings account (8 percent), supplemental health coverage (7 percent), loan from 401(K) plan (7 percent), tax refund (5 percent), loan from family or friends (4 percent) and selling or pawning a personal possession (2 percent).
The survey adds to the growing body of evidence that the combination of the growth in high-deductible health plans, which increase employees’ out-of-pocket health care financial responsibility, and stagnant wage increases is creating a medical debt trap for many workers.
In January, Twin Cities Business reported the results of two other surveys—one by the U.S. Consumer Financial Protection Bureau and the other by the National Center for Health Statistics—that foreshadowed an increase in the number of people with medical debt problems.