When someone files for bankruptcy, there’s a tendency for finger-pointing. It’s all too easy for some to assume the other person must have been irresponsible with their money.
However, it’s not frivolous purchases that cause most Americans to file for bankruptcy. In reality, medical debt is the leading cause of bankruptcy in the United States. As it turns out, more than half of people who file bankruptcy due to medical bills actually already had health insurance. Much more than half, in fact. A whopping 78 percent.
The problem is that insurance companies cut you off when they decide you are spending too much money. Suddenly, you find yourself responsible for excessive medical bills and wondering what you even had insurance for in the first place.
Now, the ACA aims to end this unfair practice by mandating that insurers remove annual and lifetime limits on insurance coverage.
Starting in 2014, all plans that are sold in the marketplace will need to cover 10 essential health benefits. These are:
· Ambulatory patient services
· Emergency services
· Maternity and newborn care
· Mental health and substance use disorder services, including behavioral health treatment
· Prescription drugs
· Rehabilitative and habilitative services and devices
· Laboratory services
· Preventive and wellness services and chronic disease management
· Pediatric services, including oral and vision care
This is a great step in reducing costs and improving access to basic care, especially for high-deductible plans being created under the ACA. The law, unfortunately, doesn’t apply to “grandfathered plans” that existed before March 23, 2010.
No longer will newly insured families who believe they are prepared for the worst discover all too late that “the worst” is actually the spending cap their insurance puts on their health.