Health care advocates look to lawmakers for help with medical debt

Vermont’s chief health care advocate will soon ask lawmakers to approve legislation that would forgive a larger percentage of the unpaid medical bills of low-income patients.

About 96% of Vermonters have some form of health insurance, but that doesn’t always mean they have the financial wherewithal to pay for health care.

Rick McDowell has been a carpenter for more than 40 years, and he’s always tried to make sure he has some sort of health insurance plan. But during stretches when he was self-employed, it was on him to balance the business ledger. And McDowell told VPR that health insurance premiums didn’t always make the cut.

“And you’re trying to bid these jobs — you know, build a deck. And how are you going to put that into the cost when you’re competing against who knows who?” McDowell said.

It was during one of those insurance dry spells, about five years ago, when McDowell found out he had a detached retina.

“I ended up — after this detached retina — with about a $45,000 bill, because I had no insurance,” he said.

The hospital that treated McDowell forgave all but $5,000 of that bill.

“I thought that was really generous,” he said. “I was like, ‘Wow.’ I couldn’t even believe it.”

But it wasn’t the end of McDowell’s health problems. A few years later, shortly after he’d landed a job at Saint Michael's College with decent health insurance benefits, McDowell had a stroke. Insurance paid for most of his care, which included a 16-day stint in inpatient rehab, but not all of it.

“Right now, we’re probably $7,000 to $8,000 in debt, I estimate,” McDowell said. “Trying to pay off that kind of debt? Forget it.”

McDowell doesn’t want people’s pity. The 63-year-old Alburgh resident said he’s a lucky guy all things considered.

“And I know there’s people out there that have it a lot worse than I do, you know, as far as medical debt,” McDowell said. “I’m sure of it.”

In each of the past six fiscal years, Vermont hospitals have reported between $63 million and $85 million annually in uncompensated medical debt. That figure does not include unpaid bills that have been forgiven — about a third of all unpaid bills in any given year — thanks to free care policies that help the lowest-income patients.

The unforgiven debt, however, can drag down the finances and credit scores of Vermonters like McDowell, according to Mike Fisher, chief health care advocate for the state of Vermont.

And Fisher said the issue of medical debt begs some important questions for the state.

“What does that mean across the landscape of Vermont? How many people does it impact? How does it affect them when they’re trying to get care?” Fisher said.

Fisher and his colleagues launched a project earlier this year in which they solicited the stories of Vermonters who’ve been saddled with medical debt. Hundreds of people, including McDowell, offered up their experiences.

“In some ways, I feel like we struck a nerve,” McDowell said.

Fisher said his office doesn’t have any accurate data on how many Vermonters are in medical debt or the average size of the bill unpaid. But he said the story gathering project laid bare one potentially severe consequence of medical debt.

“You know, some version of, ‘Because my daughter has diabetes, I can’t or my other child can’t get sick.’ And hearing person after person tell us, ‘Hey, my doctor wants me to go get this care. I can’t go. I just can’t afford it,’” Fisher said.

Fisher said people’s fear of compounding personal medical debt leads health conditions to worsen, and ends up increasing the overall cost of health care in Vermont.

“And so I’m looking for ways to provide some relief to Vermonters who are in a great deal of stress in a way that the Legislature could actually act on,” he said.

The mechanism Fisher’s landed on is a bill that would mandate uniform free-care policies at every hospital in Vermont, so that patients who meet certain income eligibilities are guaranteed to have their medical debt forgiven no matter where they receive care.

Kevin Mullin, chair of the Green Mountain Care Board, a five-member panel that regulates hospitals in Vermont, has reviewed the proposed legislation.

He said he’s “conflicted” on whether or not to support the bill.

“I don’t believe that anyone should be in a position of not getting medical care, but … I’m not so sure that this is the time to be inflicting financial damage on certain hospitals,” Mullin said.

Mullin said Fisher’s right that medical debt dissuades people from getting more health care. But, expanding free-care policies at hospitals means they’ll have to write off even more revenue than they’re losing to unpaid medical bills now, according to Mullin.

Mullin said more generous free care policies also have knock on effects for the general public, because the money to cover those unpaid bills, he said, has to come from somewhere.

“And the only place that hospitals have to shift it to is on commercial (health insurance) rates,” he said.

Karen Nevin lives in Moretown, and participated in Fisher’s storytelling project because she wants policymakers to understand how widespread the issue of medical debt really is.

“I had to pay for health insurance on the market at full price with no discounted pricing. In order to afford that, we took high-deductible plans,” Nevin told VPR. “And one medical experience gave us a bill that we had to pay 100% out of pocket, and we couldn’t afford it. We couldn’t do that.”

Nevin works at a small nonprofit. During the year she had that expensive medical experience, she made too much to qualify for insurance subsidies that might have allowed her to afford a lower-deductible plan, but not nearly enough to absorb the out-of-pocket exposure she took on with the high-deductible policy.

Nevin said the experience has only intensified her belief in the need for more systemic changes to the U.S. health care system.

“It’s just completely untenable, and the only way to get this straightened out is to, I think, sort of wipe the slate clean and start over,” Nevin said.

Start over, she said, and build a system in which people can access the care they need without risking their long-term financial security.

Rick McDowell, the carpenter from Alburgh, is on board with that concept. He said he has family members and friends who scoff at the idea of healthcare as a human right..

“I mean, people cry out socialism or what have you, but there’s a lot of hardworking people (who don’t have insurance),” McDowell said. “And it’s not about trying to be a freeloader or anything like that.”

Rather it’s about making sure people who can’t afford care, McDowell said, aren’t ruined financially when they have to get it.