Insured U.S. Residents Face Medical Debt As Insurance Plan Caps Are Slow To Rise, Hospitals Pad Bills With Inflated Charges

Main Category: Health Insurance / Medical Insurance
Also Included In: Public Health
Article Date: 30 Nov 2007 - 10:00 PST

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The Wall Street Journal on Thursday examined how the "number of Americans burdened with massive medical bills has soared" and how hospital bills that exceed $1 million, "while still unusual, are becoming more common as insurance policies once thought to provide catastrophic coverage prove inadequate when it comes to high-cost illnesses." According to a recent survey conducted by the Commonwealth Fund, 34% of U.S. adults ages 19 to 64 face problems with medical bills or have medical debt, although 62% of those individuals have health insurance.

"Part of the problem" is that, "as medical progress and new technologies raise health care costs, health plans have been slow to raise their" lifetime caps on coverage, the Journal reports. In addition, the "widespread practice of bill padding by hospitals and other health providers" has led to increased health care costs for patients, according to the Journal. Hospitals "say bill padding is their only defense against the aggressive cost-reduction efforts of insurers and government programs," but the "end result is that individuals can, with little warning, be left stuck with wildly inflated medical bills," the Journal reports.

The Journal profiled Jim Dawson, who developed a bacterial skin infection that required five months of hospitalization. During that time, Dawson, who had health insurance, accrued a $1.2 million hospital bill after he exceeded his $1.5 million lifetime cap on coverage (Carreyrou, Wall Street Journal, 11/29).

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