A stroke, a heart attack, a cancer diagnosis -- even a routine hospital stay -- can have devastating financial results, forcing millions of people into life-and-death decisions about medical care.
It happened to 25-year-old Lynda Nygaard and her 3-year-old son, Noah, when his hospitalization for dehydration from the flu in April 2007 threw their lives into such financial chaos that they were evicted from their apartment in Superior.
Before she got pregnant, Nygaard said, her financial situation was stable. But shortly after giving birth, she was laid off from her job at a grocery store and lost her health insurance. She found work and insurance through McDonald's, but her bare-bones policy covered only a fraction of Noah's hospitalization.
That hospital stay, coupled with other routine medical care, has her facing more than $50,000 in medical bills. But between trying to pay those off while paying the rent, utilities, gas and groceries, she said didn't even have the money to pay a clinic that's asking for $6. Her only debt is to local hospitals and clinics, which have sent her bills to collection agencies, which in turn send letters to her with large type blaring: "When YOU provide goods and services, you expect to be paid. Our clients are NO DIFFERENT!!!!"
"It made me poor," she said. "My son is pretty much living off cereal. It's to a point where I choose to eat what he doesn't, or not eat at all."
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Like Nygaard, being pushed into poverty by medical debt can happen even if you're insured. A 2008 survey by the nonpartisan Commonwealth Fund found that 16 percent of people with insurance had medical bills they couldn't afford to pay.
But medical debt is crueler to the uninsured. The same survey found that44 percent of uninsured respondents had unaffordable bills, and half of those said they had used up most or all of their savings toward paying them.
Two out of five uninsured adults with medical debt were unable to pay for basic necessities like food, heat or rent, according to the study.
Americans last year saved only $158 per capita, according to the U.S. Commerce Department. That means most don't have the resources to pay for catastrophic medical bills that can reach into the tens of thousands of dollars. Meanwhile, health care and insurance costs are rising faster than salary levels.
"With health care, most people are a few paydays away from financial ruin," said Patty Murto, a legal aide with the Duluth Volunteer Attorney program, which has helped hundreds of people file for bankruptcy from medical debt. "I don't think anybody's saved enough money to make it three to four months through a debilitating accident."
Two weeks after being evicted last month, Nygaard said, she was laid off from her job. The job market in Duluth and Superior was so abysmal that she said she decided to move in with a friend in suburban St. Louis, Mo., while looking for work there. But the medical bills remain, and she has no idea how she'll pay them.
"It would take me years to pay this off," she said. "If ever."
