A new study finds that health care has become the country’s largest source of debt in collections. Those debts are largest where Medicaid wasn’t expanded.
Americans owe nearly twice as much medical debt as was previously known, and the amount owed has become increasingly concentrated in states that do not participate in the Affordable Care Act’s Medicaid expansion program.
New research published Tuesday in JAMA finds that collection agencies held $140 billion in unpaid medical bills in 2018, the most recent year that data is available. An earlier study, examining debts in 2016, estimated that Americans held $81 billion in medical debt.
This new paper took a more complete look at which patients have outstanding medical debts, including individuals who do not have credit cards or bank accounts. Using 10 percent of all credit reports from the credit rating agency TransUnion, the paper finds that about 18 percent of Americans hold medical debt that is in collections.
The researchers found that, between 2009 and 2018, unpaid medical bills became the largest source of debt that Americans owe collections agencies. Overall debt, both from medical bills and other sources, declined during that period as the economy recovered from the Great Recession.