Get Ready For Piles Of COVID-Related Medical Debt!
Earlier this year, the Journal of the American Medical Association published a study showing that medical debt had supplanted all non-medical debt as the largest source of consumer debt in collections in the country, totaling $140 billion (before you add in 2020's share, which is still unknown). That's a lot of phone calls at dinner, and it's very likely going to get worse now that insurance companies have reinstated cost-sharing for COVID-related ailments.
For most of the pandemic, insurers have waived charges associated with COVID. You got COVID, you went to the hospital, you stayed in the hospital, you didn't pay anything, or you paid very little. But over the last year, states have been dropping requirements that insurers cover these bills entirely, and, increasingly, insurers are bringing back copays and deductibles. Even in the beginning of this year, one-third of all insurers were still covering all costs related to COVID. And while many Americans have insurance that might cover a decent chunk of their hospital stays, others with very high deductibles could be on the hook for a lot.
This weekend, the Washington Post highlighted the story of Jamie Azar, who got COVID 11 days after getting the Johnson & Johnson vaccine. Azar, who spent the last month on a ventilator and will still have to attend rehab due to the havoc the virus wreaked on her body, makes $36,000 a year and her employer-provided health care has a very high deductible. She now owes thousands of dollars she doesn't have.
A widow with no children, Azar, 57, is part of the unlucky majority. Her experience is a sign of what to expect if covid, as most scientists fear, becomes endemic: a permanent, regular health threat.
The carrier for her employee health insurance, UnitedHealthcare, reinstated patient cost-sharing Jan. 31. That means, because she got sick months later, she could be on the hook for $5,500 in deductibles, co-pays and out-of-network charges this year for her care in a Georgia hospital near her home, including her ICU stay, according to estimates by her family. They anticipate she could face another $5,500 in uncovered expenses next year as her recovery continues.
Bills related to her stay at the out-of-network rehab hospital in Tennessee could climb as high as $10,000 more, her relatives have estimated, but they acknowledged they were uncertain this month what exactly to expect, even after asking UnitedHealthcare and the providers.
That's $21,000, more than half of what she makes in a year. How do you get out from underneath that?
While sure, some people might be inclined to say "Well, maybe that'll convince people to get the vaccine!" COVID isn't really a one and done kind of deal. Many people who got COVID before there even was a vaccine still need ongoing treatment, either because they have long-haul COVID or because the virus caused other long-term health problems. Like Irene Schulz, who had COVID in the summer of 2020 and is still dealing with after-effects. Shulz now has more than $10,000 in medical debt.
The virus left Schulz, a COVID long-hauler, with chronic exhaustion and a weakened immune system.
But for those like Schulz, medical debt is often another lingering symptom.
Despite her long-haul symptoms, she hasn't been to the doctor in a year.
"I can't go see a doctor. I can't afford it. Our premiums, you know, every month are incredible," Schultz said. "My deductible is $3,000, so I have to meet that deductible. How do I pay that deductible?"
COVID-19 ravaged Schulz's ability to hear, and her doctors told her she would need hearing aids to compensate for the hearing loss and ringing in her ears. The hearing aids came with a hefty price tag — $5,400 — which she had to put on her credit card and pay out of pocket.
For more than six months, Schulz has been battling her insurance to cover 60% of the cost of the hearing aids — a claim they continue to deny, refusing to reimburse her, she says.
That's a lot of money. And it's going to be a lot of money for a lot of people over a lot of years. We already have more medical debt that has been sent to collections than we have non-medical debt that has been sent to collections. (Yes, it's a fraction of student debt's $1.59 trillion, but that doesn't get sent to collections. Yet.)
The fact is, a big part of the reason why insurance companies eliminated cost-sharing for COVID was that they knew it would be a bad look for them, and possibly even push some people to start wondering if they really do love their private health insurance plans as much as they did before they actually had to use them for something. Or worse, start wondering if sky-high medical bills that they can never pay are actually more scary than the word "socialized." But now, with the availability of the vaccine, they figure that there won't be much backlash. Some might even cheer it as a way to pressure unvaccinated people into getting their shots. But while most current hospitalizations are of unvaccinated people, there are still people hospitalized with breakthrough infections, even if much rarer.
Insurance companies have realized that COVID is likely going to be with us for a long time and are now just treating it like any other illness, which means they will be doing all they can to cover as little as possible, because that is quite literally how they make money.
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Robyn Pennacchia is a brilliant, fabulously talented and visually stunning angel of a human being, who shrugged off what she is pretty sure would have been a Tony Award-winning career in musical theater in order to write about stuff on the internet. Follow her on Twitter at @RobynElyse