The good news is that medical debt has been on the decline in recent years. The not-so-good news is that recent research shows the rate of decline is tied to whether a state has expanded its Medicaid program.
KCUR reports on new research:
In 2015, 30.6 percent of Missouri adults ages 18 to 64 had past due medical debt, the seventh-highest rate in the country. Kansas, at 27 percent, had the 15th highest rate.
Researchers Aaron Sojourner and Ezra Golbertstein of the University of Minnesota studied financial data from 2012 to 2015 for people who would be eligible for Medicaid where it was expanded.
They found that in states that didn’t expand, the percentage of low-income, nonelderly adults with unpaid medical bills dropped from 47 to 40 percent within three years.
“The economy improved and maybe other components of the ACA contributed to a 7 percentage point reduction,” Sojourner says.
But in expansion states?
“Where they did expand Medicaid, it fell by almost twice as much,” Sojourner says.
Those states saw an average drop of 13 percentage points, from 43 to 30 percent.
In Kansas, the rate of medical debt for nonelderly adults fell by 4 percentage points to 27 percent. In Missouri, the rate dropped 4 points to 31 percent, according to the Urban Institute.
Medicaid, as opposed to private insurance, is the key variable because it requires little out-of-pocket costs. Even if a Medicaid patient needs a lot of care, he isn’t on the hook for big out-of-pocket costs like those with private insurance.