‘I live on the street now’: how Americans fall into medical bankruptcy

It’s been over a dozen years since Susanne LeClair of West Palm Beach, Florida was first diagnosed with cancer and she’s been fighting ever since. Now she, like many other Americans facing life-threatening illness, is bankrupt despite having health insurance.

Before her first cancer-related surgery, LeClair was told by the hospital they accepted her employer-based health insurance.

“I paid my $300 copay. After the surgery, I started receiving all these invoices and came to find out the only thing covered was my bed because the hospital was out of network,” said LeClair. “My bills were hundreds of thousands of dollars, so I had no choice but to file bankruptcy.”

LeClair is on the verge of having to file for bankruptcy a second time due to the mounting medical debt she has accrued for additional cancer-related surgeries, regular appointments, medications and supplies related to her recovery, despite having health insurance and paying as much as she can out of pocket for copays, deductibles and premiums to maintain insurance.

“My medical bills are at $52,000. I’ve done everything from credit cards to consolidation loans, I just keep simply paying one credit card with another interest-free one until I can pay the next one,” LeClair added. “It’s the side of cancer most people don’t understand or know about and it’s never-ending. It just keeps adding up and adding up and before you know it you’re back in debt that you can’t believe again.”

Bankruptcy can also make it difficult to find employment given that many employers will disqualify a candidate with a bankruptcy filing found from a background check.

According to a study published in February 2019, about 530,000 bankruptcies filed annually are because of debt accrued due to a medical illness. The study found that even the Obama administration’s landmark Affordable Care Act (known as Obamacare) has failed to change the proportion of bankruptcies caused by medical debts, with poor health insurance cited as one of the main culprits.

Republicans and Democrats are currently at loggerheads over Trump administration plans to further weaken Obamacare by making it easier for states to opt out of certain requirements and offer cheaper plans that could further exacerbate the situation. And health insurance has emerged as one of the signature issues of the 2020 election, and the fight for the Democratic presidential nomination with senators Bernie Sanders and Elizabeth Warren promising a total overhaul and Joe Biden and others pledging milder reforms. What all sides admit is that the current system is broken.

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