Kansas City Docs Pay Off Medical Debt for 700 Patients
The Midwest Direct Primary Care Alliance (MDPCA), a group of Midwestern doctors and nurse practitioners, raised money to forgive a total of $1.4 million of debt for 784 patients in the Kansas City region.
The group raised approximately $11,000 to buy back the debt through the medical debt forgiveness nonprofit group RIP Medical Debt.
The 2017 Kansas and Missouri Consumer Health Access Survey reported 24 percent of Missouri adults and 29 percent of children in the state live in households with medical bills in collection status. Medical debt is especially common among residents in the Kansas City region, where in some areas 30 percent of households have medical bills in collections.
Medical debt increasingly affects young adults because they tend to have lower wages and less health insurance coverage than most households, Health Affairs reports. About one in six Americans have outstanding medical debt.
A 2009 study reported 62 percent of family bankruptcies in America were attributable to medical debt. Even though three-quarters of these debtors had health insurance, nearly all of these families owed more than $5,000 in medical expenses, with many owing much more than that.
‘We’re Happy to Help’
Allison Edwards, a physician affiliated with MDPCA, says RIP Medical Debt works as a debt aggregator that chooses not to collect.
“RIP Medical Debt simply aggregates unpaid medical bills, purchases that debt, and elects to not collect on the debt,” Edwards said. “The infrastructure is already in place. They're just using the infrastructure for good, and we're happy to help in that effort.”
Saving Taxpayers’ Money
Charlie Katebi, a state government relations manager for the Heartland Institute, which publishes Health Care News, says government health care programs and tax treatment of health care spending benefit those with generous insurance plans instead of making healthcare affordable for those who need it most. The federal tax deduction for employer-provided health insurance tends to benefit people with larger benefit packages while doing nothing to help reduce the price of care for low-income people with less comprehensive health care plans or no insurance at all, Katebi says.
“Our tax code and entitlements, particularly Medicare, subsidize health care benefits that disproportionately go to wealthy people,” Katebi said. “Despite the rhetoric we hear out of Washington, a lot of federal health care policy, in reality, is used disproportionately to benefit the wealthy. When health care prices rise, it really makes it harder for poorer people to access the healthcare system.”
Katebi says the effort by MDPCA is a good way to help people plagued by high health care costs.
“Debt forgiveness is one of the most comprehensive ways to address financial burdens in the healthcare system,” Katebi said. “Forgiveness can also save taxpayers money because unpaid medical debt is often unloaded onto the county or local government.”
Health care providers are aware of the medical bills consumers face, Edwards explains in an essay at the Kansas City Direct Primary Care website, “A Commentary on the Cost of Care in the US.”
“As practicing physicians, it's impossible to ignore that medical bills are a problem for anyone interacting with the healthcare system,” Edwards said. “Whether you practice in a direct primary care model, as we do, or you're in the traditional insurance-based, fee-for-service world, patients want to know the price of the care that's being suggested. Every physician can easily recall patient interactions that included the mention of the burden of medical debt, and this problem isn't just in our community; the problem is pervasive nationwide.”
Katebi says the lack of price transparency in the system, caused by the prevalence of third-party payment, drives prices up.
“Health care providers—doctors and hospitals—often can bid up the prices of their products because insurers cover the costs,” Katebi said. “This practice forces lower-income people with less coverage to go into medical debt because they can’t afford those higher prices. People practicing direct primary care have a strong interest in the financial well-being of their patients. Primary care is a promising option state officials can consider to help poorer people access the healthcare they need.”
“$1.4 Million in Medical Bills Erased by Donation,” Midwest Direct Primary Care Alliance: https://midwestdpcalliance.squarespace.com/debt-relief-pr