
How the Affordable Care Act Drove Down Personal Bankruptcy - ch4s3
http://www.consumerreports.org/personal-bankruptcy/how-the-aca-drove-down-personal-bankruptcy/
======
danesparza
This is an interesting story, but correlation is not causation. The article
even admits this, stating "The truth is that it’s not that easy to determine
how many bankruptcies are caused by medical debt. Examining the paperwork
doesn’t always offer insight because debtors often juggle their indebtedness,
for example, using a credit card to pay an outstanding medical bill while
leaving other debts unpaid."

The bankruptcy code itself changed tremendously in 2005:
[http://www.nolo.com/legal-encyclopedia/new-bankruptcy-law-
ch...](http://www.nolo.com/legal-encyclopedia/new-bankruptcy-law-
chapter-7-13-30040.html)

The housing market bubble mostly likely had a tremendous effect on
bankruptcies as well:
[https://en.wikipedia.org/wiki/United_States_housing_bubble](https://en.wikipedia.org/wiki/United_States_housing_bubble)

~~~
notadoc
It has long been established that medical bills are the leading cause of
bankruptcy and a significant cost burden, this is not new information.

[http://www.cnbc.com/id/100840148](http://www.cnbc.com/id/100840148)

[http://www.npr.org/sections/health-
shots/2016/03/08/46889248...](http://www.npr.org/sections/health-
shots/2016/03/08/468892489/medical-bills-still-take-a-big-toll-even-with-
insurance)

If you're slightly interested in this topic, 2 milliseconds on Google will
reveal a wealth of information.

~~~
SamReidHughes
It's also well known that study considered any bankruptcy with the slightest
smidgen of medical debt to be a medical bankruptcy. Edit: or expenses. Over
$1000 in expenses over 2 years and you're in that category.

------
kbutler
Amazing what you can infer if you look at a small enough window of time.

[http://www.tradingeconomics.com/united-
states/bankruptcies](http://www.tradingeconomics.com/united-
states/bankruptcies) (hit the "max" button)

Pretty clearly shows that the ACA came at the trailing end of the huge spike
in bankruptcies from the real estate bubble bursting.

Correlation does not imply causation, however much one wants to sell a
particular story. I expect better from consumer reports.

~~~
maxerickson
You've linked corporate bankruptcies there. Trends in personal bankruptcy do
appear to be similar though.

[http://www.bankruptcyaction.com/USbankstats.htm](http://www.bankruptcyaction.com/USbankstats.htm)

------
narrowrail
I'm not sure I care for this topic on HN, but I believe one of the biggest
problems in healthcare is the 'collaboration' among the hospitals and
insurance companies on billing through the National Uniform Billing
Committee[0], which ultimately results in people not knowing how much stuff
costs (i.e. how much is an MRI). Without this knowledge, people can't make
proper decisions because it's completely opaque.

[0][https://en.wikipedia.org/wiki/National_Uniform_Billing_Commi...](https://en.wikipedia.org/wiki/National_Uniform_Billing_Committee)

------
agileminor
Or bankruptcies started coming back down again after the 2008 crash. Note that
their graph/data start in 2009 - if you include years before that, this
"result" no longer makes any sense.

------
ruby-99
This seems like an interesting side effect, that I'm not sure policy makers
had anticipated.

~~~
maxerickson
No, reducing medical bankruptcy was an explicit goal of expanding access to
insurance.

Here's text from the legislation:

 _Half of all personal bankruptcies are caused in part by medical expenses. By
significantly increasing health insurance coverage, the requirement, together
with the other provisions of this Act, will improve financial security for
families._

~~~
Johnny555
Which is just another hidden cost of not having universal healthcare -- when a
hospital can't recover $250,000 in cancer treatment costs due to a bankrupty,
they have to make it up somewhere else, so we end up paying $17 for a 10 cent
ibuprofen pill in the hospital.

~~~
massysett
I doubt hospitals have cost accounting systems sophisticated enough for them
to have any idea what the cancer treatment costs, just as Verizon doesn't know
how much it costs for you to talk on the phone for fifteen minutes. Just
because they billed $250,000 doesn't mean that's what it cost or even that
they ever expected to actually receive $250,000.

Besides, apparently the goal of universal healthcare was to allow everybody to
still receive the "$250,000" cancer treatment that they were getting before
universal healthcare. This suggests that both with and without universal
healthcare, the cancer treatment was being provided, so not having universal
healthcare did not actually create another cost.

This isn't trivial nitpicking: the ACA was sold as something that would reduce
costs. This was mostly false. The real aim of the ACA was to raid the pockets
of more people. Before, there was a "$250,000 cancer treatment" and the
insured paid for it with a "$17 ibuprofen." The true objective of the ACA was
to keep the "$250,000 cancer treatment" but instead pay for it by raiding the
pockets of young, healthy people who previously did not have insurance.

It turns out that raiding the pockets of young, healthy people is not so
politically popular. They didn't have insurance for a reason--it's expensive!
Their unemployment and student debt is already high, and they already have to
pay for old people through Social Security and Medicare tax. Yet the ACA
wanted to use those young people, who would pay premiums, use little health
care, and thus help pay for more "$250,000 cancer treatments".

Now this political dishonesty is blowing back, as the insurance markets are
under strain because the young healthies still aren't getting insurance to
help pay for the cancer treatments that others get.

~~~
brianwawok
I don't think your raiding pockets of kids goes with reality. Why then did ACA
let kids stay on parents insurance to 26 even if married? Millions of kids got
free insurance by hopping on their parents plan. Millions of kids got better
medical treatment for no money out of their pocket.

ACA isn't perfect but it's way better than we had before.

------
rebootthesystem
Does everyone here understand that the ACA much promoted "twenty-seven million
people now have insurance" is a complete farce? The number keeps expanding, of
course, and it is a tragedy of almost unimaginable proportions.

OK, with great claims one must offer solid evidence. No problem, I accept this
responsibility. Thankfully this is a rather easy task.

The great majority of these 27 million people are on what's known as Medicaid.

Is Medicaid health insurance?

No, it is not. Medicaid is a loan.

What?

Medicaid is a loan from the government. It is, if one wishes to interpret it
this way, no different from taking out a home equity line of credit.

In other words, you must repay what you spent.

Yes, care you receive under Medicaid must --BY LAW-- be repaid. And, when your
lender is the government the realities of dealing with the worst possible kind
of loan shark --one with overwhelming power-- can and do easily surface.

Medicaid enrollment as of 2016 reached over 70 million people. Here's the
requisite chart:

[https://www.statista.com/statistics/245347/total-medicaid-
en...](https://www.statista.com/statistics/245347/total-medicaid-enrollment-
since-1966/)

Every single one of these people has, effectively, entered into a promissory
note with the government. They DO NOT have health insurance, they have a loan.

And here's where it gets ugly: The State, again, by law, is obligated to seek
repayment for services offered and can --and does-- attach your property in
the process of doing so.

Medicaid is a program that has convinced people they have medical insurance
when, in reality, they have a loan. And this loan can and does cost them their
estate as the State automatically becomes the first lien holder once you are
on Medicaid.

Please don't take my word for it. Here it is from the horse's mouth:

[https://www.medicaid.gov/medicaid/eligibility/estate-
recover...](https://www.medicaid.gov/medicaid/eligibility/estate-
recovery/index.html)

Here's another source with a revelation that should terrify anyone:

"if the property is sold while the Medicaid beneficiary is living, not only
will the beneficiary cease to be eligible for Medicaid due to the cash from
the sale, but the beneficiary would have to satisfy the lien by paying back
the state for its coverage of care to date"

They should have added "refinanced" to that statement.

[http://www.elderlawanswers.com/medicaids-power-to-recoup-
ben...](http://www.elderlawanswers.com/medicaids-power-to-recoup-benefits-
paid-estate-recovery-and-liens-12018)

Medi-Cal has similar provisions:

[http://www.dhcs.ca.gov/services/Pages/TPLRD_ER_cont.aspx](http://www.dhcs.ca.gov/services/Pages/TPLRD_ER_cont.aspx)

Another reputable source:

[http://www.nolo.com/legal-encyclopedia/how-medicaid-
recovers...](http://www.nolo.com/legal-encyclopedia/how-medicaid-recovers-the-
cost-long-term-care-from-your-estate-after-you-die.html)

You might have to pay your parent's Medicaid bill:

[https://www.agingcare.com/articles/medicaid-repayment-of-
nur...](https://www.agingcare.com/articles/medicaid-repayment-of-nursing-home-
estate-recovery-150497.htm)

More detail from HHS:

[https://aspe.hhs.gov/basic-report/medicaid-estate-
recovery](https://aspe.hhs.gov/basic-report/medicaid-estate-recovery)

[https://aspe.hhs.gov/basic-report/medicaid-liens](https://aspe.hhs.gov/basic-
report/medicaid-liens)

To be clear, estate recovery was not imposed by ACA. No, this has existed
since the very start of the program.

What ACA has done is to systematically shove tens of millions of people into
Medicaid for, dare I say, political gain. Nothing less than putting lipstick
on a pig.

ACA membership numbers look good to the uninformed because tens of millions of
people have been hoisted onto Medicaid. If left unchecked these numbers could
easily reach into the hundred million plus range.

This is a tragedy. None of these people fully understand that they do not, in
fact, have health insurance at all. They are signing on to a loan, with the
loan shark being the government.

Think about this for a moment: This is probably the largest grab of personal
property from any government anywhere in the world in the history of humanity.
And all of this property is being grabbed from the poor and lower middle
class.

Soon one hundred million of our citizens will owe the government everything
they possess in order to repay their medical bills.

This is theft sold as medical insurance. When you have real insurance of any
kind the insurance company doesn't come after your estate to recover their
costs. When you have real insurance the insurance company doesn't take a chunk
out of the sale of your home while you are alive and, at the same time, kick
you out of your insurance policy.

Medicaid is NOT insurance, it's a dystopian reality nobody is talking about.

I think this is absolutely revolting.

Why aren't the idiots burning down business districts during their
"demonstrations" up in arms about this shit? Right, it requires critical
thinking skills.

EDIT: I failed to add something very important here, which is what my position
is on how this should work. I apologize for not making that clear.

Medicaid Estate Recovery should NOT be a part of the program.

It should NOT exist.

We should provide medical care to the needy without ANY recovery requirements
whatsoever.

If someone needs a million dollars in medical care they should receive it.

They should not have to worry about being on the hook to repay it in any way.

That is what a decent and compassionate society does and how it behaves, not
by sinking it's hooks into people who have no choice but to sign on the dotted
line.

If this estate recovery business were done by a private insurance company they
would be destroyed by both public opinion and brought-up on fraud charges. We
should demand better from our government. We should demand that estate
recovery be completely removed from Medicaid.

Hope that clarifies my position.

~~~
alttag
> Medicaid is a loan.

Um, ... no. Or, at least not in my case.

Our son was diagnosed with cancer at the age of three. Medicaid served as
secondary insurance, and thankfully so, as the bills from the first month
exceeded $300,000. This went on for nine months.

It's now been eight years since he passed, with no mention from any agency
about recovery.

Besides, it seems you left a few things out of your diatribe. From the
medicaid.gov link:

    
    
        > For individuals age 55 or older, ... recovery of payments 
        > from the individual's estate for [specifically enumerated things, 
        > which does not appear to include doctor visits].
    

Also:

    
    
        > States may not recover from the estate of a deceased Medicaid 
        > enrollee who is survived by a spouse, child under age 21, or
        > blind or disabled child of any age. States are also required to 
        > establish procedures for waiving estate recovery when recovery 
        > would cause an undue hardship.
    

So, at best a fear-mongering half-truth. Maybe we can agree Medicaid is for
people with no money. The government seems to have a procedure that attempts
to collect money from an estate, in certain circumstances, _after a patient
dies_ , if there really was money available.

~~~
frankydp
The OP may be over the top and on the fear-mongering side of things, but there
are some very difficult situations monetarily especially for elderly
recipients. While there is some policy to not completely bankrupt surviving
spouses, the reality of a long term care spouse utilizing medicaid is that the
surviving spouse must reduce assets to below $2500 with few exceptions or
shelters. That policy will almost guarantee that the surviving spouse if not a
homeowner, will be strongly below the poverty line for the rest of their life.
The primary cause of that scenario is the huge gap between enough money to be
retired(50k-150k), and the amount of money required to be retired without
assistance(350k-500k). Full time skilled care like a retirement home, can
easily cost $7k a month on the low end, with averages around 28months.

The OP may be able to make a more widely accepted argument, by more
empathetically communicating that medicaid is at best emergency support for
crisis, and not a vehicle for long term or widespread medical care. He is
correct that using Medicaid as a primary vehicle for ACA coverage expansion
ensures a very large group of people will have huge negative motivations to
exit poverty, even more so than were previously. I would guess that the OP has
first hand experience with Medicaid policy completely eliminating a family
member's entire life's monetary worth, which is a hard pill to swallow when
someone has paid into Medicaid for decades.

[http://www.longtermcarelink.net/eldercare/nursing_home.htm](http://www.longtermcarelink.net/eldercare/nursing_home.htm)
[https://www.ahcancal.org/ncal/facts/Pages/State-
Data.aspx](https://www.ahcancal.org/ncal/facts/Pages/State-Data.aspx)

edit: typo medicaid

~~~
rebootthesystem
In the US it is extremely easy to rack-up hundreds of thousands of dollars in
medical bills. A single operation can cost $200K. Be ill for an extended
period of time and the idea of millions of dollars in medical care isn't out
of the realm of the possible.

And so, imagine selling the family home to try to pay medical bills or provide
more favorable circumstances only to get a knock on the door by the Medicaid
estate recovery folks who have first dibs on the proceeds of the sale.

Not only that, the sale also means the patient is now kicked off Medicaid
because they have money.

I'll repeat it because the shift in perspective is important:

If a private insurance company had exactly the same clauses in their policies
people would be up in arms, they would be brought up on charges and some of
their management would land in jail. Yet we are willing to accept this from
our government? And enroll people by the tens of millions?

This should not be. We should provide care to the needy without any such
preconditions. Our government should not sink hooks into them at all.

Readers seem to be confusing passion for fear mongering. This is real and, as
far as I am concerned, it is seriously immoral. We should not be in the
business of doing this to our own citizens. This isn't health insurance. Not
sure what it is, but I know what it is not.

This is the point that is being missed in my exposure of this issue: This is
an abomination. The US should not have a program fraudulently presented as
insurance that takes people's property at all. Even if the net effect was that
this only affected ten people, it would be wrong.

We should take care of those who need care and not set hooks into them or
their estate.

