The Double-Edged Sword of Healthcare Costs

Increased education on health insurance can allow college students entering the professional world to understand the health benefits offered by hiring businesses, and to make practical decisions in choosing a plan from the marketplace.

“The most important thing to explain to young people is how important it is to have health coverage. They need to understand the financial risks of not being covered,” said David Claudio, a Financial Counselor at Hackensack Meridian Health.

One of these financial risks is medical debt. According to a report by the Kaiser Family Foundation (KFF), “About four in ten adults (41 percent) in the United States…have some level of medical debt, owing an estimated $195 billion or more in total.”

Allianna Makowski, a senior English student, said, “Medical bills and copays are really expensive in America, and the process of waiting in urgent care has been nothing but terrible since the pandemic hit.”

Steve Barsoum, a pre-med biology student, shared his experience with health insurance regarding an ankle surgery this past summer. “My insurance did not want to cover it,” he said. “We delayed my surgery about two weeks and fought with insurance to only end up with 40 percent of the bill covered. In that two-week span, my injury began healing in the wrong position so they had to re-break the fracture to adjust it properly.”

Both Makowski and Barsoum faced difficult financial obligations in receiving healthcare even while insured. Barsoum mentioned that he was required to pay $5,000 out of pocket for anesthesia, the materials used to break and fix his ankle, and the plates put in. “Overall, insurance left me in the dirt to fend for myself,” he said.

This prompts many healthcare professionals and patients alike to wonder about the consequences of facing those same medical circumstances without insurance. For example, having a home aid to assist in basic necessities is typically an inaccessible luxury to those without insurance. “We have some patients where their family chips in and they pay for an aid… eventually they say we can’t do this anymore, we can’t afford it.” said Keith Gosselin, a Registered Nurse and a full-time employee for an insurance company.

Uninsured patients can apply for payment plans or Charity Care, which is free or reduced care for eligible patients meeting a certain income bracket and financial need. However, Claudio notes that many patients have a difficulty finding healthcare providers who accept Charity Care.

Charity Care is driven by the Affordable Care Act, which makes the majority of hospitals non-profits and, consequently, tax-exempt, as they provide free or reduced-cost care for low-income patients. However, there are no determined thresholds for how much a hospital needs to contribute to their charity care fund, giving them a loophole to restrict the subsidized services they should provide to maintain their nonprofit status, as described by The Berkeley Group, a student Organization at UC Berkeley that consults for non-profits and social enterprises. “Nearly half—45 percent—of nonprofit hospital organizations are routinely sending medical bills to patients whose incomes are low enough to qualify for charity care…collecting $2.7 billion in bills sent to patients who…would have qualified for financial assistance under the hospitals’ own policies,” reported Kaiser Health News.

Another study by the Center for Studying Health System Change (CHSC) also found that “Physicians in larger groups or institutional-based practices, such as medical schools or hospitals, are less likely to provide Charity Care,” as reported by The Commonwealth Fund. The report mentioned that physicians “at the highest income levels—$250,000 or greater—provide more Charity Care than physicians who make $120,000 or less.”

One way that many are able to afford health insurance is through their job.

Health insurance is becoming expensive for employers as well. “Given the circumstances with rising health insurance costs, many employers, including mine, are attempting to cut health insurance costs by either reducing benefits or increasing contributions from their employees. Either way, it will translate to less net benefits to employees,” said O’Halloran.

Given the way insurance companies impact patients, employers, and employees in America, Alicia Cook, a Supervisor at Oscar Health, calls for a need for accountability. “We need to hold everyone accountable.

Not just physicians, but the front desk representatives, the insurance enrollers [representatives], etc… If we don’t, people are treated as just a different number; just another sale,” she said.

Accountability begins with being well-informed. Accountability comes with understanding various terms and processes while signing paperwork.

“It is important that adolescents and young adults understand the healthcare system and the way health insurance can impact their options in life,” said Colleen Beach, a Licensed Social Worker. “The right to health is a human right. The access to healthy living and the care needed to maintain the best quality of life possible is unequal and inequitable.”