Health Wealth Symposium

Oakland, CAJune 23, 2010

Mark Rukavina, DirectorThe Access Project

rukavina@accessproject.org(617) 275-2825

The Access Project

National health research and advocacy organization supporting local health access improvement efforts

Mission: work to strengthen community action, promote social change, and improve health, especially for those who are most vulnerable

Provide technical assistance to local efforts through research, policy analysis, community engagement, and communication services

Nationally recognized for expertise on issue of medical debt

The Problem of Escalating Healthcare Costs

Between 2000 and 2005, health insurance premiums increased by 73 percent while workers’ wages rose by only 15 percent

In 2008, $2.3 trillion was spent on healthcare in the United States

Uninsured and Underinsured

46 million Americans have no health insurance

25 million Americans are underinsured

Unaffordable Health Care Costs Plague American Families

72 million American adults (41%) under the age of 65 experienced medical bill problems

Problems paying or unable to pay medical bill Contacted by a collection agency for unpaid medical

bill Changed way of life in order to pay medical bill Medical debt or medical bills being paid off over time

Nearly two-thirds of people experiencing these problems had insurance at the time the medical care was provided

Health Care Costs Deplete Savings

21 million Americans were unable to pay for basic necessities such as food, heat, or rent due to medical bills

28 million Americans used up all of their savings trying to pay off medical bills

21 million Americans took oncredit card debt to pay medical bills

Medical Debt Consumes Assets

7.5 million Americans took out a mortgage or loan in order to pay off medical debt

Nearly one in five retired Americans used retirement account funds to pay healthcare expenses

Twenty-eight (28%) percent of those taking early or hardship withdrawals from retirement accounts did so to pay for medical emergencies

Medical Debt Ruins Credit

28 million American adults were contacted by a collection agency for unpaid medical bills

More than half (52%) of non-credit related accounts in collection are medical bills

Bills in collection are considered major derogatory accounts and lower credit scores

Lower credit scores effect consumer’s ability to obtain credit and/or the price of credit

Many People Lack Disposable Income to Promptly Pay Off Reduced Medical Bills

Payday lending research found that 31% of borrowers reported using the funds for emergency expenses, such as car repairs or medical expenses

Housing Problems Result from Medical Debt

Nearly half (46%) reported having medical debt

More than one-quarter (27%) of respondents with debt said housing problems resulted from the medical debt

Relatively small debts had far-reaching effects• 12% of respondents with medical debts of less

than $500 reported having housing problems Source: Home Sick: How Medical Debt Undermines Housing Security, The Access Project, November 2005

Among clients seeking assistance filing income tax forms at 7 Volunteer Income Tax Assistance sites:

Unaffordable Health Care is Costly for Families and the Economy

One study of home mortgage foreclosures in four states found that nearly one in four (23%) of all respondents indicated that their foreclosure was caused in part by unmanageable medical bills

Approximately 45,000 families, or 7% of the 633,000 families facing foreclosure and counseled through the National Foreclosure Mitigation Counseling Program, cited medical issues as the primary reason for mortgage default, more than those identifying an increase in loan payment as primary reason for default

Health Reform IS Anti-Poverty Work

Expansion of Medicaid eligibility up to 133% of the federal poverty level would bring coverage to an estimated 16 to 23 million low-income people

Millions of Americans who have never received public benefits will qualify for new subsidies under health reform

New rules governing insurance companies will reduce likelihood that insured patients will be left unprotected

The Opportunity TODAY: Many Medical Bills Could Be Covered By…

Private Insurance – Millions of Americans never exercise their right to internal or external review for appealing private insurance claims

Public Programs – Millions of American children and adults are eligible but not enrolled in government-sponsored health coverage programs

Charity Care – Healthcare providers often have charity care or financial assistance programs but many patients with outstanding medical bills know little or nothing about such assistance

The Access Project’s Comprehensive Medical Debt Work-Out Protocol

Reduced or eliminated millions of dollars in medical debt for more than 1,500 clients

Successfully reduces the burden of medical debt and renegotiates affordable payment plans

Repairs credit ruined by medical bills on credit reports

Provides up-to-date information in a rapidly changing health policy environment

Americans Trust Non-Profits to Help With Financial Problems

Many people with medical debt are committed to paying off the bills in full but lack the liquidity to do so

The Access Project is interested in partnering with counseling, credit repair and asset building programs, as well as financial services providers to offer new opportunities

Medical Debt Work-Out Demonstration Program

Partner with existing programs and organizations providing counseling and other direct services to low- and moderate-income clients

Provide assistance to program clients with medical debt, evaluate intervention

Share data on affordability and medical debt with public policy makers