$195 Billion in Medical Debt

Nearly 1 in 10 Americans has significant medical debt, according to an analysis of the numbers by Peterson-KFF Health System Tracker. KFF researchers analyzed data from the Census Bureau's Survey of Program Participation to determine who had significant medical debt as of December 2019 and how much they owed. They defined "significant" medical debt as $250 or more in unpaid medical bills. 

Overall, 23 million people—9 percent of U.S. adults—have significant medical debt. Those most likely to have medical debt are people aged 50 to 64 (12 percent), Blacks (16 percent), people in nonmetropolitan areas (13 percent), residents of the South (12 percent), and the uninsured (13 percent). But medical debt is common in every demographic segment. Even among those with health insurance, 9 percent have significant medical debt. 

Distribution of adults with significant medical debt by how much they owe, 2019

13% owe between $250 and $500

18% owe between $501 and $1,000

20% owe between $1,001 and $2,000

22% owe between $2,001 and $5,000

13% owe between $5,001 and $10,000

13% owe more than $10,000

Aggregate medical debt for those with significant medical debt adds up to $195 billion in unpaid bills, the researchers estimate. "Medical debt remains a persistent problem even among people with insurance coverage," the researchers report. "The fact that medical debt is a struggle even among households with health insurance and middle incomes indicates that simply expanding coverage will not erase the financial burden caused by high cost-sharing amounts and high prices for medical services and prescription drugs," they conclude.

Source: Peterson-KFF Health System Tracker, The Burden of Medical Debt in the United States

Who Takes Prescription Drugs?

Nearly half of Americans are currently taking a prescription drug, according to Health, United States, 2014. In the past 30 days, 47 percent of the public has taken at least one prescription drug, 21 percent three or more, and 10 percent five or more. By age, here is the percentage who have taken at least one prescription drug in the past month...

Percent taking at least one prescription drug in past 30 days
Under age 18: 23.5%
Aged 18 to 44: 38.1%
Aged 45 to 64: 67.2%
Aged 65-plus: 89.8%

Source: National Center for Health Statistics, Health, United States, 2014

So Much for the Inheritance Boom

For decades we've been hearing about the billions of dollars the baby-boom generation would inherit as their elderly parents (the richest elders in history) passed on. But a new study of inheritances finds their impact declining rather than growing. The study, published in The Journal of Economic Inequality and reported on in the Monthly Labor Review, uses 1989 to 2007 data from the Survey of Consumer Finances to examine the impact of inheritances on household net worth.

The impact is a fizzle, not a boom. Rather than increasing as a share of household net worth during the 1989 to 2007 time period, the inheritance share fell from 29 to just 19 percent. Where did the money go?

No one knows for sure, but here's my theory: The prime suspect in the disappearance of all those billions is the health care industry. Perfectly positioned to siphon family wealth from long-lived elders, the health care industry has transformed the long-awaited inheritance boom into a health care facilities, services, and salary boom. According to the Employee Benefit Research Institute, the average man aged 65 or older needs $122,000 in savings to cover 90 percent of his out-of-pocket health care costs in retirement. The average woman needs $139,000. Those numbers are conservative because they do not include the extraordinary cost of long-term care.