Power Grid Blog
The Affordable Care Act means that a medical diagnosis like MS is not a precursor to bankruptcy
August 17, 2012 | Mark Perriello
Have you ever heard of “medical bankruptcy? That’s what happens when the cost of being sick grows so high that it sends the person into bankruptcy. Some studies estimate that close to half of personal bankruptcies in the U.S. are due at least in part to medical bills.
The risks of medical bankruptcy are particularly high for people with disabilities and those with chronic or long-term illnesses like lupus, cancer, HIV, or Multiple Sclerosis, which recently forced Ann Romney to take a break from her busy campaign schedule. First Lady Michelle Obama’s late father, Fraser Robinson, also had Multiple Sclerosis.
Believe it or not, even someone with health insurance have fallen into bankruptcy over medical bills. That’s because before the Affordable Care Act (ACA) passed, insurance companies could drop people with disabilities and chronic illnesses from coverage. They could also impose “lifetime caps” on people with MS, cancer, or other illnesses—that means that they could stop paying medical expenses for an insured person who continues to pay premiums and is still ill.
Before the ACA, insurance companies could also discriminate against people with long-term illnesses or other disabilities because they have a “pre-existing condition.” Now this discrimination is illegal.
Though medical bankruptcy sounds different than other forms of bankruptcy—it doesn’t happen because someone lives beyond her means, for instance—it falls under the same laws as any bankruptcy has the same consequences, including having credit cards and lines of credit canceled and losing most of your assets.
Before the ACA, an MS diagnosis (or cancer, epilepsy, diabetes, or other long-term or chronic illnesses) could spell financial disaster for a hard-working family. The ACA goes a long way to making sure that a medical condition does not threaten a family’s security.
The late Fraser Robinson and Mrs. Romney are just two examples among millions of people who have chronic diseases that are painful and draining and can require medical care across a lifetime. The added risk of bankruptcy is something that family should have to endure. That’s one of the many reasons AAPD supports the Affordable Care Act, and why we will continue to do all we can to preserve this law