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Massachusetts reform hasn't stopped medical bankruptcies: Harvard study
Date:3/7/2011

The percentage of personal bankruptcies linked to medical bills or illness changed little, and the absolute number actually increased in Massachusetts after the implementation of its landmark 2006 law requiring people to buy health insurance, a Harvard study says.

The new study, which appears in today's American Journal of Medicine, found that between early 2007 and mid-2009, the share of all Massachusetts bankruptcies with a medical cause went from 59.3 percent to 52.9 percent, a non-significant decrease of 6.4 percentage points. Because there was a sharp rise in total bankruptcies during that period, the actual number of medical bankruptcy filings in the state rose from 7,504 in 2007 to 10,093 in 2009.

The findings have national implications because the Obama administration's health law is largely patterned after the Massachusetts plan, including its individual mandate. One of the administration's arguments in support of the new federal law was that it would significantly reduce medical bankruptcies nationwide. The findings in Massachusetts cast doubt on that claim.

Moreover, the president's recent proposal to let states opt out of the national health reform threatens to further weaken the inadequate standards for coverage that were included in the 2010 reform law. The result may well be the growth of skimpier plans nationwide, leading to even higher rates of medical bankruptcy than in Massachusetts.

To explain why medical bankruptcies persist in Massachusetts, the authors of the new study write: "Health costs in the state have risen sharply since reform was enacted. Even before the changes in health care laws, most medical bankruptcies in Massachusetts as in other states afflicted middle-class families with health insurance. High premium costs and gaps in coverage co-payments, deductibles and uncovered services often left insured families liable for substantial out-of-pocket costs. None of that changed. For exam
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Contact: Mark Almberg
mark@pnhp.org
312-782-6006
Physicians for a National Health Program
Source:Eurekalert

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