Medical Debt Dropped Significantly During Pandemic: Urban Institute Report

The number of people carrying unpaid medical debts has declined markedly during the COVID-19 pandemic, according to new research that has been released, but the report did raise concerns that those numbers could boomerang and start climbing again now that the people are returning to pre-pandemic life.

Just under 17% of nonelderly adults had medical debt, a problem paying medical debt, or a medical debt in collections as of April 2021, compared with 23.6% in March 2019, according to the report, which was released by the Urban Institute. The number of families reporting issues paying their medical bills fell to 12.2%, from 17% two years earlier. Those figures had both been holding stead in the years before the pandemic, so to see any significant change is worth of being noted.

Individuals between the ages of 25 and 34 were the most likely to have a medical debt in collection (18%), while those over the age of 65 were the least likely (7.8%).

“The declines in medical debt and problems paying medical bills during the pandemic could be due to many factors, including a reduction in health care use resulting from efforts to prevent coronavirus exposure, growth in Medicaid enrollment that protected many people from the cost of high medical bills, and pandemic relief measures that provided temporary financial assistance to households,” according to the report. “The risk of acquiring medical debt may increase when health care use rebounds to pre-pandemic levels and the provisions of federal pandemic legislation that have contributed to Medicaid enrollment growth expire.”

The percentage of adults with medical debts that were placed with a collections agency has decreased among all age demographics, according to the report, most notably among younger adults.

To keep those figures where they are, or to help them continue declining, the report’s authors suggest a number of recommendations, including expanding coverage of Medicaid, ensuring compliance with the No Surprises Act, and regulating debt collection practices. This includes following what some states have done in limiting collection practices and interest rates on medical debts.

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