In a back-and-forth about 鈥淢edicare for All” and the cost of health care, Sen. Elizabeth Warren (D-Mass.) directed the discussion back to medical debt and bankruptcy 鈥 citing her own work from Harvard Law School.
鈥淏ack when I was studying it, two out of three families that ended up in bankruptcy after a serious medical problem had health insurance,鈥 Warren said.
This is a new emphasis in the ongoing debate over health care costs, and the debate over what role health care plays in American finances. Instead of focusing on uninsurance, Warren stepped into whether the insurance people currently have is sufficient.
But much of the research around medical debt and bankruptcy is controversial 鈥 especially Warren鈥檚 own work.
We decided to take a deeper look.
What The Research Says
Warren鈥檚 campaign directed us to research published in 2009 in the American Journal of聽Medicine. Co-authored by Warren, it looks at a random sample of 2,314 bankruptcy filers from 2007.
The paper examined what debtors reported as their cause of bankruptcy. Warren is referring here to people who either cited significant direct medical debt, remortgaged a home to pay medical debt or lost income due to illness.
In that category, more than two-thirds of families had health insurance 鈥 in fact, three-quarters did.
So from that simple standpoint, the statistics check out.
The Controversy
But it isn鈥檛 necessarily that simple. This specific paper has long been the subject of controversy 鈥 in part, because it focuses on people who have declared bankruptcy, rather than looking at the financial impact of medical debt at large.
Scholars are also quick to note that, in the majority of so-called medical bankruptcies identified in the paper, the issue wasn鈥檛 debts incurred to pay off health care bills. Rather, the bigger problem was foregone income because people couldn鈥檛 work.
That has fueled a lengthy back-and-forth, in particular over whether this paper is useful in determining what role medical debt plays in fueling bankruptcies.
But its impact on this specific claim isn鈥檛 so clear. That鈥檚 because Warren narrowed her statement, and focused on something less disputable.
For one thing, the paper is clear in finding that two-thirds of families 鈥斅 in fact, more than that 鈥 experienced bankruptcy after a medical problem despite having health insurance.
That finding was 鈥渢he headline of the study,鈥 said Paul Ginsburg, a health economist and professor at the University of Southern California. (Ginsburg also noted the importance of foregone earnings in driving bankruptcies, rather than medical bills.)
And Warren qualified it further during the debate, by limiting this statistic to what was found 鈥渂ack when [she] was studying it鈥 鈥 making it a less sweeping claim.
What鈥檚 more suspect is whether this finding 鈥 even if accurate 鈥 supports her next point: that the cost of health care is what鈥檚 driving people鈥檚 financial problems, and that a generous single-payer plan would ameliorate this issue.
For instance, 鈥淵ou cannot go from that result to a conclusion that we need Medicare for All,鈥 Ginsburg said.
Health insurance is more generous today than it was when Warren studied it, thanks to the Affordable Care Act. And insuring everyone 鈥 even as generously as Medicare for All suggests 鈥 wouldn鈥檛 necessarily address the issue of foregone earnings when people are sick, which the research suggests is a bigger financial concern.
Our Ruling
Warren鈥檚 claim comes from a paper that is controversial, and whose methods and interpretation have been called into question. That said, this statistic is fairly specific, and her wording in the claim precise. In itself, it鈥檚 a fair reflection of what the paper says.
Where caution is more important: Warren said this finding suggests the cost of health care is what鈥檚 causing Americans financial harm. That isn鈥檛 necessarily borne out and requires more scrutiny.
This statement is accurate but would benefit from more information. We rate it Mostly True.
