There has been a lot of change regarding health insurance and coverage since President Obama came into office. The Affordable Care Act and the laws and provisions it entails have made a rather large impact on everyone, both personally and in terms of business. Opinions on new provisions vary; however, without venturing down that slippery slope, let’s take a look at some medical debt facts resonating for those with and without coverage.
According to credit.com, over 45 million Americans (15% of the population) don’t have health insurance. Nearly half of those without medical insurance currently have medical debt averaging $9,000 per person. However, medical debt doesn’t only affect those without medical insurance. Over 60% of families who report having medical debt issues are covered. And, interestingly, 75% of those who filed for bankruptcy because of medical debts had health insurance.
Protecting your faculty and staff with quality coverage or health-care options/alternatives is important—and likely part of your school’s values and mission. Not to mention for most schools and organizations (50+ FTEs), it’s now the law. However, as the statistics show, even those covered by medical insurance are at risk of incurring medical debt.
Informing your school’s faculty and staff of the underlining issues concerning medical debt can help solidify a positive environment on your campus by reducing stress as well as helping them make informed decisions when selecting options for themselves and their families. Because after all, it’s their debt, but it’s also your problem. Financial debt is a mental distraction as well as an increased health risk when you consider that 60%–80% of on-the-job accidents are stress related, 75%–90% of all doctor visits are stress-related, and 40% of employee turnover is due to stress.
A report from the National Consumer Law Center highlighted some of the reasons for the growing medical-debt issue in the U.S.
Lawsuits. Something that not many people may know is that health-care providers can send medical debts to collection agencies, file judgments, garnish wages, obtain home liens, and even take patients to court over delinquent medical bills. Spouses of patients can also be pursued for payment even if they don’t live in a common-law state.
When facing a medical bill crisis (or any financial debt situation for that matter), it’s important to remember that, even when you feel like you’re sinking, you still have rights.
Harassment is illegal. Federal and many state laws protect people from harassing collectors. The law takes into consideration hardships; in many locations, provisions to protect the financially distressed from abuse, deception, loss of privacy, or unfair treatment are implemented. Illegal intimidation—such as talking to friends and employers about a consumer’s debt without permission from the debtor, making abusive telephone calls, and threatening to take actions that are illegal or not intended—is intolerable.
High interest rate credit options. Loans and credit cards with low introductory interest rates are often offered to people in crisis situations. It’s a quick solution to quiet one collector. However, introductory rates are often quickly raised and can increase overall debt even as they’re paid each month.
Worse than credit offers cluttering home mailboxes are the doctors who assist credit agencies in debt “scams.”
An article published by The New York Times in October, 2013, highlights just how such alliances between doctors and financing firms can sweep patients off their feet, landing them smack in the middle of a debt disaster.
Financial traps. Although medical bills can hang over your head, they shouldn’t come before your most important bills, such as mortgage payments and credit cards. It’s also important to note that taking out a home equity loan to pay expensive medical bills lands many people not just in deeper debt but also in jeopardy of losing their homes if they’re unable to pay.
Financial stress affects productivity in the workplace. Studies conducted over decades show that when financial stress strikes, it costs both the employer and the employee time and productivity. In 1979, it was reported that 10% of the workforce was facing financial difficulty. Today, it is estimated that 25% of the workforce is affected.
Understanding medical billings and potential financial risks is a heavy topic. If you’re not comfortable discussing all the ins and outs of your plan—such as out-of-network providers, deductibles, premiums, and how to handle insurance company disputes—then you might want to consider inviting your broker in to address your faculty and staff on one of your professional development days. Managing personal finance might also be a considered topic for personal development as it impacts your employees mental well-being—hence your school’s culture.
Additional ISM articles of interest
ISM Monthly Update for Business Officers Vol. 9 No. 6 Setting Goals for a Healthier School
Private School News Vol. 8 No. 11 Kids Feel Stress Both From Their Parents and Peers
Additional ISM articles of interest for Gold Consortium members
I&P Vol. 28 No. 14 Scheduling Professional Development for Faculty and Staff
I&P Vol. 34 No. 10 Professional Development During Hard Economic Times
