When Medical Bills Outpace Your Means, Seize Control Swiftly
MEDICAL bills have a way of piling up — especially when you’re sick or underinsured. Just ask Kirk Kupka, 48, and his wife, Susie, 53.
Mr. Kupka has multiple sclerosis. The Kupkas, who live in Lindstrom, Minn., have an annual income of $45,000 — a combination of her salary as an office manager and his disability payments.
More than 20 percent of that income goes toward health care. Their annual insurance premiums total $5,400, and then there’s the $4,000 Mr. Kupka spends on drugs, doctor’s visits and lab fees before he fulfills his policy’s deductible.
In the three years since Mr. Kupka’s disability forced him to stop working as a mental health therapist, he has accumulated $12,000 in debt.
“It’s frustrating,” he says. “We earn too much to qualify for state and county assistance, but not enough to stay ahead of the bills. I’ve thought maybe my wife and I should get divorced. But not only is it against our faith, it turns out it wouldn’t help.”
Medical debt can lead to drastic measures, forcing people to raid their 401(k)s, tap into home equity lines and, in some cases, declare bankruptcy. Surveys by the Commonwealth Fund, a nonprofit health care research foundation, found that 41 percent of adults said they were strling to pay their health care bills in 2007, up from 34 percent in 2005. That percentage is almost surely growing.
And as Mr. Kupka’s situation illustrates, it’s not just uninsured patients who rack up large bills. Nearly two-thirds of those with debt problems, according to Commonwealth, had health insurance.
But insurance covers less and less these days, as employers continue shifting more health care costs to their employees, and as consumers resort to lower-cost plans that come with high deductibles or less generous benefits.
“People who have been faithfully paying insurance premiums for years are coming in with medical bills they can’t pay,” said Gail Cunningham, a spokeswoman for the National Foundation for Credit Counseling, an umbrella group for services that help consumers cope with debt.
But if you’re having trouble paying your medical bills, you’re not helpless, either. There are ways to reduce, or at least more effectively manage, medical debt.
CONFRONT, DON’T IGNORE Procrastinating only leads to trouble. If your bills are turned over to a collection agency, the debt goes on your credit report and will remain there for lenders, and even potential employers, to see. You may have difficulty getting a loan and, if you do get one, you’ll be charged higher rates. So take action — even if that doesn’t mean writing any checks right away.
|