Though the number of uninsured Americans has dropped significantly over the past decade, many still lack any form of health insurance coverage. The passage of the Affordable Care Act (ACA) allows millions to choose a government-subsidized healthcare plan. However, many consumers are ineligible for subsidies, and many of those who qualify have chosen not to participate.
In the first quarter of 2024, according to a preliminary report by the National Health Interview Survey (NHIS), 8.2% or 27.1 million adults across all age groups lacked health insurance. Survey findings showed that the uninsured rate and number of uninsured increased from Q4 2023 (7.7% or 25.5 million people of all ages).
Key Takeaways
- Health insurance costs are on the rise for both employer-based and individual-based plans.
- Americans are no longer taxed for not carrying health insurance.
- Medical debt contributes to a large number of bankruptcies in America.
- Access to quality primary care is critical, but doctors have the right to refuse patients without insurance or who are able to pay out-of-pocket expenses.
Important
As of 2019, individuals and families without insurance are no longer taxed due to the repeal of the tax-penalty portion of the Affordable Care Act. However, some states have their own mandates and penalties, so if you’re in one of these states without coverage, you might face a fee.
Absence of Medical Services
Contrary to popular belief, health providers are not required by law to provide medical services to individuals without insurance. However, emergency rooms in hospitals that participate in Medicare are legally obligated under EMTALA to provide emergency care, regardless of a patient’s ability to pay.
The National Center for Chronic Disease Prevention and Health Promotion reports that six in 10 Americans have been diagnosed with a chronic health condition, such as high blood pressure, high cholesterol, heart disease, or obesity. A study by the Transamerica Institute revealed that 49% of the uninsured in 2019 suffered from a chronic illness. Ninety percent of the nation’s $4.5 trillion in annual healthcare expenditures are from citizens coping with chronic diseases and mental health issues.
The ACA requires many preventive services to be covered by insurance policies with no copay. However, as shown in several large population surveys, it is widely recognized that uninsured adults are less likely to receive recommended preventive and screening services.
Preventive care is crucial for detecting illnesses or conditions early before they develop into serious problems. Early detection increases the probability of successful treatment and can prevent certain diseases altogether.
Medical Debt
With or without health insurance, an unexpected illness or serious accident requiring medical attention, emergency care, or a follow-up treatment plan can lead to poor credit or even bankruptcy.
Moreover, while hospital bills can vary based on factors like location and the patient’s condition, the average daily cost in the U.S. exceeds $2,000. With an average hospital stay of 4.6 days, the total average cost amounts to $13,262. However, if surgery is involved, the costs for the most common procedures can surpass $100,000.
In a 2022 report, the Consumer Financial Protection Bureau highlighted that medical debt is the most common type of third-party collection on consumers’ credit reports and the most frequent type of debt that consumers are contacted about by debt collectors. In fact, Americans are estimated to collectively owe at least $220 billion in outstanding medical debt. Even when medical debt doesn’t end in bankruptcy, it takes a toll on consumers.
According to a recent study in the Journal of the American Medical Association, 17.8% of individuals had medical debt in collections in June of 2020.
Consumers with massive medical debt are less likely to be able to save money and more susceptible to the type of financial strain that leads to forgoing necessities and borrowing money, according to the Kaiser Family Foundation.
No More Tax Penalties
In 2018, the ACA tax penalty was $695 for adults and $347.50 for children, or 2.5% of one’s annual income, whichever amount was more. However, in 2017, when the Tax Cuts and Jobs Act was signed into law, it repealed the ACA-related tax on Americans who refuse to purchase health insurance.
As of 2019, Americans without health insurance are not taxed by the government. However, individuals and families who choose to go without health insurance do so at their own risk.
The Bottom Line
Healthcare is expensive—even with insurance. However, those who don’t have insurance coverage will be at a much greater disadvantage. The inability to seek treatment for health conditions and the crushing weight of medical bills are two big reasons to obtain coverage.
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