Medical financial stress greatest among families with children

Practices report more young families needing help with bills, even as public insurance is increasingly available for youths.

By — Posted March 26, 2012

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The woman arrived at the office of Peter Rappo, MD, a pediatrician in Brockton, Mass., with triplets in tow. They all needed checkups and vaccines, and the insurance company required a $50 co-payment for each child. When Dr. Rappo found out that the woman’s husband had just lost his job, he waived the co-pays.

“She started crying,” Dr. Rappo said. “Look, I’m not going to retire on three patient visits. Some people are obviously hurting.”

Dr. Rappo’s situation is typical. About a third of families — 32.4% — experienced financial burdens in the first half of 2011 because of medical expenses, according to data released March 7 by the Centers for Disease Control and Prevention’s National Center for Health Statistics. Families with children 17 and younger were the most likely to have financial hardships.

For example, 23.7% of those in this age group were in families that had problems paying medical bills within the past year, and 13.4% were in families with bills that could not be paid. In contrast, only 6.7% of people older than 75 were in families with problems paying medical bills within the past 12 months, and 2.4% were in families with bills they couldn’t pay. Overall, 38.6% of people 17 and younger were in families experiencing some burden in paying for care, compared with 33.6% of those 18 to 64 years old; 19%, ages 65 to 74; and 12.1%, 75 and older.

Cassidy Medical Group, which has 16 family physicians, pediatricians, internists and obstetricians-gynecologists in four offices in and around Vista, Calif., has noticed that families with children younger than 18 are most likely to have bills older than 90 days. The practice will write off debts that patients cannot pay if they respond to notices and phone calls about their debt, and will ask patients to pay when they can. They often do. The practice accepts very little Medicaid, and some patients are referred to community clinics if their financial problems become long term.

“That segment certainly had greater difficulty paying their bills and paying on time,” said Judy Krueger, Cassidy’s executive director.

Physicians caring for children say the availability of insurance for children younger than 18 has improved during the past few decades, particularly from the public sector. However, economic turmoil has made paying medical bills more difficult recently. Even insured families cannot always afford care for their children, because unemployment and poverty have grown among this demographic. The CDC said only 7.8% of patients younger than 18 were uninsured, and 4.9% were without a usual source of care. About 22.3% of patients 18 to 64 were uninsured, and 19.5% had no usual source of care.

Meanwhile, unemployment and poverty have increased in families with children. U.S. Census Bureau data indicate that the overall poverty rate was 15.1% in 2010, an increase from 14.3% in 2009. The proportion of families with children younger than 18 in poverty grew from 20.1% in 2009 to 21.5% in 2010. For families with children younger than 6, the poverty numbers rose from 23.8% in 2009 to 25.3% in 2010.

According to the Bureau of Labor Statistics, 87.8% of families with children had at least one employed parent in 2009. This declined to 87.4% in 2010, the lowest figure since the agency started tracking it in 1994. The proportion of married couples with children where both parents worked dipped from 58.9% in 2009 to 58.1% in 2010.

The impact of recent economic turmoil may be even greater if a child has significant health problems. A study published March 19 in Pediatrics linked childhood autism to reduced family earnings. Families with an autistic child earned 21% less than those with an offspring with other health issues. Incomes were 28% less than families with healthy children.

Though physicians and practice managers say numerous strategies can maintain a good patient relationship through a bad patch, they say practices need to know when to drop the issue, cut their losses or turn a patient’s account over to a collections agency.

Cassidy writes off some bills, but other practices turn accounts over to a collection agency if calls and letters requesting payment are ignored.

“We’re not liberal when it comes to turning over a bill to collections,” Krueger said. “You have to evaluate every single account. If the family says they cannot pay, we will write it off to bad debt. We know times are hard.”

This flexibility can pay off. Krueger has noticed many families continuing or returning to a practice after going to significant lengths to pay bills even if it takes time.

As for Dr. Rappo, the family of triplets is back on its feet, visiting him for routine care and paying its medical bills.

“Now they are patients for life,” he said.

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What families have problems paying medical bills?

Families with children are more likely to struggle with medical bills. Expanding public programs for children’s health has not been enough to completely lessen the financial burden on their parents or guardians.

Bill-paying issue 0-17 years 18-64 65-74 75 and older
Problems paying medical bills within the past year 23.7% 20.9% 10.2% 6.7%
Paying medical bills over time 31.7% 26.8% 15.9% 9.3%
Have medical bills that cannot be paid 13.4% 10.7% 4.8% 2.4%
Any financial burden related to medical expenses 38.6% 33.4% 19.0% 12.1%

Source: Financial Burden of Medical Care: Early Release of Estimates From the National Health Interview Survey, January-June 2011, Centers for Disease Control and Prevention’s National Center for Health Statistics, March 7 (link)

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