Survey: Americans with medical debt more worried about cost than health
A new survey from Discover Personal Loans revealed 58% of Americans took steps to address an unexpected expense since the beginning of the COVID-19 pandemic. Whether they felt prepared to handle these expenses varied. Regarding medical expenses specifically, more than four in 10 say they don't feel prepared to handle these surprise costs.
For those with existing medical expenses, 53% say the pandemic caused them to take on new medical debt, adding to the stress many are already feeling. In fact, the survey by Riverwoods-based Discover found Americans with medical debt are more anxious about the cost of their medical services than their health; 63% of Americans report that they are anxious about paying for medical debt, compared to 47% who worry about getting better.
"People should be more focused on getting and staying well, rather than feeling held back by medical bills," said Matt Lattman, vice president of personal loans at Discover said. "If there are gaps between what you owe, what insurance will cover and what's left in savings, turning to a personal loan might allow someone to pay off medical debt or other expenses in one lump sum, with a lower interest rate than other financial vehicles, and without hidden fees."
In addition to anxiety, medical debt has led to other challenging and potentially harmful choices. Eight in 10 of those with existing medical debt say they have postponed medical care because of the cost, and medical debt has also caused Americans to forgo financial commitments:
According to Discover's survey, nearly 3 in 4 Americans with medical debt have more than $2,000 in outstanding payments. And to make these payments, more people with medical debt report using their credit card, 41%, to pay for their care, over their medical insurance, 38%. Others also cited leveraging payment plans from their hospital, 27%, and personal loans, 22%.
Regardless of current medical debt, 58% of Americans addressed an unexpected expense because of the pandemic.
Americans most frequently needed to cover unexpected expenses such as auto and home repairs, and emergency expenses. To pay for these unexpected bills, consumers say they resorted to tapping their emergency savings, borrowing money from loved ones and paying their bills later than usual.
"For many, unplanned costs during the past year created roadblocks in financial journeys, especially for people who were already feeling the strain from other areas of debt and expenses," Lattman said.