Research Paper

Preventing Medical Debt: Recommendations for Hospitals and Health Systems

This report examines the role that hospitals and health systems play in the national medical debt crisis, identifying specific actions they should take now to prevent patients from experiencing debt-related declines in financial, physical, mental, and social health.

Monday, March 28, 2022
 Preventing Medical Debt: Recommendations for Hospitals and Health Systems

Data Spotlight

52% of patients
are more stressed about their medical bills than their medical care.

$400-$800
is the median medical debt owed by patients – which may not be worth pursuing administratively.

45% of nonprofit hospitals
routinely send medical bills to patients eligible for financial assistance.

Key Recommendations

With input from members of our Stakeholder Advisory Council, the Financial Health Network developed recommended strategies for hospitals and health systems to help prevent medical debt. Although each recommendation is effective as a stand-alone, hospitals and health systems can achieve the greatest impact by implementing them all. 

Improve Financial Assistance and Repayment Programs
    • Expand financial assistance eligibility to include patients unable to pay medical bills, including insured patients with unaffordable out-of-pocket expenses.
    • Ensure financial assistance is available to all patients who may be eligible. 
    • For patients who are not eligible for financial assistance, expand repayment options and ensure they have access to these options prior to the billing process. 
    • Engage a broad range of constituents for regular review and improvement of financial assistance policies.
    • Halt legal action against patients eligible for financial assistance. 
Support Informed Patient Decision-Making
    • Elevate, improve, and effectively use price transparency tools to support informed patient decision-making.
    • Incorporate cost-of-care conversations into the care process, and provide education and training to care teams. 
    • Provide financial navigation services to help patients understand costs and access financial assistance.
Proactively Identify Risk of Medical Debt
    • Proactively identify patients who may struggle to pay medical bills.
    • Develop patient-centered approaches for assessing ability to pay, and link these assessments directly to financial assistance and repayment options.
    • Incorporate medical debt as an explicit focus area of Community Health Needs Assessments.

Opportunities to take action for hospitals and health systems - While many upstream factors contribute to medical debt, this report focuses on interventions that hospitals health systems can implement to prevent medical debt and its devastating impacts on financial health and health

Explore the Full Series

Systems-Level Overview

Systems-Level Overview

Explore insights into the prevalence of medical debt and its effect on consumers, how medical debt functions as a social determinant of health and driver of health inequities, and opportunities for key players to prevent it.  

Learn More

Recommendations for Insurers

Recommendations for Insurers

Discover opportunities insurance providers should seize now to help members navigate plan selection, understand key terminology, reduce out-of-pocket expenses, utilize preventive care, and improve administrative processes that affect customers.

Learn More

Recommendations for Employers

Recommendations for Employers

Find out about proactive steps employers should take now to assess employee health insurance affordability, educate their workforce on insurance basics and out-of-pocket costs, help workers manage healthcare expenses, and offer plans based on employees’ needs and circumstances.

Learn More

Our Supporter

Support for this report series was provided by the Robert Wood Johnson Foundation. The views expressed here do not necessarily reflect the views of the Foundation.

More to Explore

Preventing Medical Debt: Recommendations for Employers

This report shines a light on employer decisions around health insurance and how those decisions have helped shape the medical debt crisis, explaining specific actions employers should take now to reduce employee financial stress while improving productivity and retention.

Preventing Medical Debt: Recommendations for Insurers

This report shows how the shifting health insurance landscape has helped shape the medical debt crisis, identifying specific actions insurers should take now to boost Americans’ confidence in their coverage and motivate them to pursue timely care that reduces the need for costlier services.

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Written by

  • Michelle Proser
    Senior Director, Healthcare Solutions
    Financial Health Network
  • Uzma Amin
    Manager, Healthcare
    Financial Health Network

Preventing Medical Debt: Recommendations for Hospitals and Health Systems

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