If you get sick in America, you will likely be in debt. Four in 10 adults in the US have healthcare debt, KFF found.
One surprising risk:live in communities where hospitals have consolidated – an increasingly common development as health systems merge or large systems gobble up smaller hospitals.
This is based on a new report shared exclusively with KFF Health News byUrban Institutea nonprofit organization that has been tracking medical debt across the United States for years and is collaborating with KFF Health News on our Diagnosis: Debt project.
It is well documented that hospitals raise prices as they gain market power, which can occur when systems become larger or competitors close.
So researchers at Urban wondered whether market concentration could also lead to more patients going into debt.
“With fewer alternatives and higher prices, patients may have limited options for seeking more affordable care,” the report’s authors hypothesized. “They may delay seeking treatment, potentially leading to worse outcomes and even higher medical debt in the future.”
Making such a direct connection is difficult, in part because many factors influence the magnitude of medical debt existing in society.
Urban researchers have shown, for example, that medical debt is higher in areas with higher numbers of uninsured residents and higher rates of chronic diseases such as cancer or diabetes.
To explore the impact of consolidation, the researchers first looked at the concentration of hospitals in each region of the US.
They then looked at credit bureau data to see the number of area residents who had unpaid medical bills on their credit reports, which is one measure of medical debt in a community.
Nationally, the number of people who have medical bills on their credit reports has declined. But the researchers saw that the decline was less pronounced in countries where hospitals were more consolidated, even after taking other factors into account.
“While medical debt reporting declined in most US states between 2012 and 2022, increasing hospital market concentration hindered such improvement in many regions of the country,” they wrote.
Perhaps unsurprisingly, the report drew criticism fromAmerican Hospital Association(AHA), the industry’s largest trade group.Molly Smithvice president of the public policy group at the AHA, called it a “thin analysis” that does not take into account important factors driving medical debt such as the rise in high-deductible health plans.
“Until policymakers take into account the true causes of medical debt,” he said, “our country will be unable to develop public policies that can address this enormous problem.”
Urban InstituteBreno Bragaone of the report’s authors, acknowledged that factors such as chronic disease remain stronger predictors of medical debt than market consolidation. But, he said, the new research should give policymakers another reason to examine the growing market power of health systems across the country.
“Limiting hospital consolidation could be beneficial for consumers in limiting medical debt,” he said.
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