One of the most dysfunctional aspects of America’s dysfunctional health care system is medical debt. Even insured patients today can find themselves saddled with crushing debt from hospital stays. It’s a problem that will only be solved when America finally joins the rest of the advanced world in creating a true universal health care system. In the meantime, the Biden administration has announced a plan that could somewhat ease the problem.
Most importantly, the administration is eliminating medical debt from consideration when determining creditworthiness for federally guaranteed mortgages. This is an eminently reasonable policy change that the private sector should implement as well. Unlike other forms of debt, medical debt isn’t indicative of irresponsibility — just of having the bad luck to get sick in America. To lump the blameless cancer patient together with the reckless credit-card junkie is outrageous.
Significant personal medical debt is a foreign concept to citizens in most of western Europe, where near-universal, largely publicly funded coverage is the norm. In the U.S., meanwhile, health care for most Americans is treated like just another free-market service — if an unusually expensive one. While the Affordable Care Act, or Obamacare, has eliminated the most egregious aspect of that system by making it illegal for health insurers to deny affordable coverage to people with preexisting conditions, even those with insurance still can rack up five- or six-figure debts just from the patient portions or uncovered services.
