Help Prevent Bankruptcy – Watch Your Health

As advocates of health care reform have long noted, a serious health problem can usher in fiscal chaos, not just for the poor, but also for the middle class. Recent studies have indicated that almost a full two-thirds of personal bankruptcies have a direct relationship with medical problems, with even those having health insurance being affected. It seems that guarding health can be an important factor in avoiding bankruptcy.

Citing a recent study published in the American Journal of Medicine (pdf.) in an article published on June 4, 2009, the Washington Post reported that “sixty-two percent of all bankruptcies filed in 2007 were linked to medical expenses.” Interestingly, according to an article published on the same date in Forbes, “77.9 percent of those bankrupted by medical problems had health insurance at the start of the bankrupting illness, including 60 percent who had private coverage.”

The Forbes article also pointed out that “since the data used in the study were collected prior to the current economic downturn, it's likely that the current rate of medical-related bankruptcies is even higher,” noting that “most of those bankrupted by medical problems were "solidly middle class" before they suffered financial disaster.” While in some cases, it was having the main income earner struck down by a medical problem that upset the financial balance, in all too many, the balance was tipped from middle class to bankruptcy by medical expenses, despite having insurance coverage.

This relates to basic, bottom-line structural problems with the health insurance industry, as well as to the difficulties in the economy. Just because a person pays for coverage doesn't mean that it will be there when they need it, as many have discovered when a health crisis happens. After all, health insurance is a business like any other – profit is king, and sick people are not profitable. Thus, efforts on the part of insurers to rid themselves of costly sick people should come as no surprise.

"For middle-class Americans, health insurance offers little protection. Most of us have policies with so many loopholes, co-payments and deductibles that illness can put you in the poorhouse,” said Harvard Medical School associate professor of medicine and study co-author Dr. David Himmelstein, as quoted by Forbes in its June 4, 2009, article. According to a June 2, 2009, Wall Street Journal report, out-of-pocket health costs for those insured through their employment have been creeping upwards, “especially those who were sick and of modest means.”

Lawmakers here and there throughout the nation are making noises about mandating some protections. On June 3, 2009, the LA Times reported “California Insurance Commissioner Steve Poizner plans to unveil proposed regulations today to combat the health insurance industry practice of dropping members with costly illnesses.” According to a May 31, 2009, report in the Journal Sentinel, Wisconsin lawmakers are currently considering legislation that “would make it much more difficult for health insurance companies to drive up the rates of customers who get sick.”

Consumers, however, would be a bit premature in celebrating the attention that lawmakers are giving their plight, as it is – realistically – unlikely that they'll gain any substantive legislative relief any time soon. Powerful lobbyists spend millions in the effort to influence the legislative process to their best benefit. According to a September 25, 2008, report published by the New England Journal of Medicine, “since 2006, the health sector has spent more money on lobbying than any other sector of the economy,” and the amount of that sector's spending has “increased their spending more rapidly than other health care industries.” The health insurance industry is in no hurry to have profit potentials decreased by increased governmental regulation.

A far more practical step for the average consumer would be to take steps to guard their health. It could be among the most important ways to avoid finding themselves struggling to find ways to eliminate debt taken on to cover the health insurance gap or being pushed into bankruptcy. In addition, many of the most simple ways to protect long-term health will be a boon in this era of troubled economic circumstances, as they'll help save money now, while promoting long-term health and well-being.

As writer Mark Rubi pointed out in a June 5, 2009, article for the Examiner.com, it's all connected – bankruptcy, health problems, obesity and being overweight, and too sedentary of a lifestyle. Almost a full two thirds of American adults fall into the medical classification of overweight or obese, wrote Rubi, citing data from the Centers For Disease Control. Rubi also noted the myriad of health issues directly associated with being overweight and the sedentary lifestyle that has become so common today, including “Type 2 Diabetes, Metabolic Syndrome (including High Blood Pressure), Coronary Heart Disease and Stroke, Cancer and Sleep Apnea.” He also referred to an interesting recent study that found “that nearly 85% of injured workers studied were classified as either overweight or obese.”

Choosing to eat simpler, healthier foods cooked at home, as opposed to drive-through or take out foods and overly processed, nutritionally lacking, chemically enhanced convenience foods, can reduce food costs significantly. Leaving the car parked and walking or taking public transportation and walking part way to destinations can help to control weight and build strength, while saving money on fuel and other driving costs. Making a conscious effort to move more, whether it is doing stretching exercises while watching television, parking farther away from the door when shopping, or taking an evening walk can make a real difference in long-term health costs by helping to improve health.

Washing hands regularly is one of the most effective ways of preventing colds, flus, and numerous other sicknesses and diseases. Learn where germs lurk and take a common sense approach to protecting yourself. Drying your hands on your shirt is better than touching a damp towel used by others. You may be picking up more than you bargained for on the self-serve buffet line at the local restaurant that everybody breathes on, touches, and maybe even coughs and sneezes on. Caring for your largest organ – your skin – helps it to serve one of its essential purposes, which is to keep germs and other potential invaders outside of the body. A thoughtful and informed approach to day-to-day life can save health care dollars.

Health care costs are a serious financial burden for many in America today, and that is true whether people have insurance or not. With employers seeking to reduce costs, employees find themselves bearing more and more of the costs of insurance. Insurance companies seeking to maintain profits provide less protection against the soaring costs associated with health care. People facing health problems find it difficult to get insurance coverage at any cost. It comes as no surprise that bankruptcy often has to do with medical costs. The smartest move for the consumer, whose interests in health care costs have to compete with those of powerful, well-funded lobbyist for the attention of lawmakers, is to take simple, yet effective, steps every day to guard their own health and, hopefully, reduce their current and future health related costs.