Health Care Hardship before and during COVID-19: Financial Protective Factors

Background: Despite passage of the Affordable Care Act (ACA) in 2010, U.S. households hold near $200 billion in medical debt while 47% say it is difficult to afford health care costs and a third said they or a family member skipped care due to cost. Difficulties affording health care and holding medical debt diminish utilization, especially among people with serious illness like breast cancer and diabetes (Wharam et al., 2018, 2019) and thus act as a financial determinant of health. However, it is unclear how household financial factors interact to affect decisions to skip or delay needed health care.

Data and Method: Data from the 2018 (N=27,091) and 2021 (N=27,118) National Financial Capability Study surveys were used to assess health care hardship before and during the COVID-19 pandemic. Negative binomial regression with two- and three-way interaction terms for medical debt, income, emergency savings, and insurance predicted a count of three types of health care hardship – not filling a prescription, skipping medical care, and putting off medical care controlling for health insurance, age, and other factors. An additional variable was created to indicate living in a state with a comprehensive charity care state law based on a 2021 report by the National Consumer Law Center.

Findings: The average predicted count of hardship experiences was 0.58 and 0.50 out of three hardship types and 29% and 27% experienced at least one hardship type in 2018 and 2021, respectively. Individuals living in states with charity care laws were 22% and 25% less likely to have past due medical bills (p < .001) and had fewer instances of hardship (p < .001) in 2018 and 2021, respectively. Incidence rate ratios (IRR) concerning model-predicted counts of hardship events with medical debt were 2.60 and 2.70 in 2018 and 2021, respectively (p < .001). Protective factors for hardship in 2018 and 2021 included having emergency savings (IRR = 0.68 and 0.58, p < .001), health insurance (IRR = 0.63 and 0.60, p < .001), and higher income (p < .001). Statistically significant results were found for two-way interactions between medical debt and emergency savings, insurance status, and income in both years while significant results were found for many three-way interactions in 2021, but not 2018, though hardship was far more prevalent in the presence of medical debt across interactions.

Significance: Our findings were stable before and during the COVID-19 pandemic, showing that having overdue medical bills dissuades individuals from filling prescriptions and seeking medical care. Individuals are more likely not to be dissuaded when they have emergency savings, higher incomes, health insurance, and live in a state with comprehensive charity care laws. These findings suggest that the ACA should be amended to lower out-of-pocket cost burden in insurance plans, eliminate persistent coverage gaps, and hold hospitals more accountable for providing charity care discounts.