Tens of millions of households face medical debt; some relief is coming

·3 min read

Louise Trice’s 90th birthday was a bright spot in the shadow of the pandemic in August of 2020.

“That was the best day ever,” said Trice’s daughter Robyn King. “It was a barrage of drivers driving passed. It was a beautiful day.”

Friends and family gave socially distanced birthday wishes and sang songs, while Trice was adorned in a birthday sash and full of smiles. Trice was living in an Ohio nursing home at the time and was being treated for Alzheimer’s disease.

They are memories that King cherishes dearly today. Just a few months later in October of 2020, her mother died. To make matters harder, just days before Trice’s passing, King found out she was stuck with a roughly $80,000 bill from her mother’s nursing home.

“The thought of them trying to get $80,000 from me was like, it’s not going to happen. Not in this lifetime,” said King.

King said it turned out that the Medicaid coverage for her mom’s nursing home care lapsed without her family knowing. King says she filled out the proper paperwork, including documentation saying she would not be financially responsible.

“I got a letter in the mail where I was being sued,” said King. “They let things go on for months before they brought it to my attention that this is where we were and I was like well why didn’t you say something sooner?”

King said the Legal Aid Society of Cleveland helped resolve the claim against her. But while she is no longer personally responsible for the bill, King said the nursing home is still going after her late mom’s assets.

King testified on Capitol Hill before members of Congress this year to share her story as a warning about the burden of medical debt. “There’s just no excuse for this in America,” King said during her Congressional testimony in March 2022.

Data shows King is not alone.

A report from the Consumer Financial Protection Bureau (CFPB) shows there is an estimated $88 billion in medical debt on Americans’ credit reports as of last year.

And that number could likely be higher, since some medical debt doesn’t show up as medical debt, depending on how the consumer paid the cost.

“A lot of people find themselves in a position where they either have to take out other loans, borrow money from friends and family, or put medical debt on credit cards,” said Jenifer Bosco, a staff attorney for the National Consumer Law Center.

According to the CFPB report, roughly 20 percent of U.S. households report they have medical debt.

The National Consumer Law Center said some recent changes will significantly help consumers.

Starting this summer, the three major credit bureaus announced they will no longer include medical debt on credit reports after it has been paid off.

Additionally, starting in 2023, the companies will only report medical debt that is at least $500.

The move could remove nearly 70 percent of medical debt collection from credit reports.

But consumer advocates warn that the credit bureaus’ actions are just voluntary right now and there are still millions of people with medical debt that is less than $500.

“We would like to see those made permanent and enforceable also to be able to reach the remaining people who have medical debt because many of those people are going to have catastrophic amounts of medical debt,” said Bosco.

King is hoping lawmakers do more to require better notification to families about their loved ones’ medical bills.

“I definitely think more safeguards need to be put in place,” said King. “This is the land of the free and home of the brave and yet we have people who are being penalized for being sick or being penalized for taking care of a loved one.”

STAY UPDATED: Download the Action News Jax app for live updates on breaking stories

Download WJAX Apps
Download WJAX Apps