The Burden of Medical Debt in the Middle Class: Challenges and Solutions

Medical debt is a growing concern for middle-class Americans, highlighting the often-overlooked financial strains faced by families who find themselves in the heart of the middle class. According to a recent report from Third Way, a center-left think tank, almost a quarter of middle-class Americans, around 17 million people, dealt with unpaid healthcare bills in 2020 – a higher percentage than those both higher and lower on the income scale.

Based on US Census Bureau data, the report reveals a complex landscape of financial challenges that middle-class individuals and families face, particularly as they navigate the aftermath of health issues like cancer.

Understanding the Middle-Class Landscape

Third Way defines middle class as a family of three earning between $50,000 and $100,000 annually – a demographic often referred to as "the heart of the middle class." This group carries higher rates of good health insurance compared to lower-income individuals. However, the report points out several factors that exacerbate their financial struggles:

1. Limited Assistance: Despite being less likely to avoid healthcare due to costs, middle-class Americans often have limited access to financial assistance and debt relief at hospitals, especially compared to lower-income individuals.

2. High Deductibles: Middle-class individuals are less likely to have the disposable income to cover high deductibles and out-of-pocket expenses.

3. Racial Disparities: Medical debt affects families in multifaceted ways, such as delaying homeownership and hindering the creation of intergenerational wealth, which is particularly concerning for Black families.

Disparities by Race

The report also unveils disparities along racial lines. Black and Hispanic middle-class Americans face a higher likelihood of having unpaid healthcare bills compared to their White and Asian peers. The numbers are telling:

- Nearly 38% of Black middle-class individuals have medical debt.

- Just over 25% of Hispanic middle-class individuals are burdened by medical debt.

These figures are in contrast to 20.4% of White and 16.6% of Asian middle-class individuals who face medical debt.

A Glimmer of Change

Amid these challenges, there is a growing awareness of the issue of medical debt. Federal agencies like the Consumer Financial Protection Bureau, the US Department of Health and Human Services, and the US Department of Treasury are initiating inquiries into medical credit cards and other specialty financial products that contribute to high healthcare costs and debt burdens.

Furthermore, credit reporting agencies Equifax, Experian, and TransUnion are making changes to how medical debt impacts credit reports. For example, medical collection debt that has been paid off will no longer appear on credit reports, eliminating a significant portion of debt from consumer records. Additionally, the grace period before unpaid medical collection debt appears on credit reports has been extended to one year.

Looking Forward

While medical debt remains a significant concern, these steps suggest a shifting perspective on addressing the issue. Cancer survivors in the middle class and their families should take advantage of these evolving solutions to navigate the challenges posed by medical debt. By understanding the resources available, advocating for financial assistance, and taking proactive steps, they can continue their journey toward post-cancer recovery with greater financial security and peace of mind.


- [CNN Article: "Middle-class Americans crushed by medical debt"](


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