A report released by Massachusetts Attorney General Andrea Joy Campbell highlights the challenges faced by households with commercial health insurance in affording health care. The Health Care Cost Trends report from the Attorney General’s Office (AGO) examines the financial strain on families who cannot meet medical expenses, leading to debt accumulation.
The report emphasizes that affordability is not solely about health care prices but also involves a household's ability to pay for medical expenses without sacrificing other needs or incurring debt. "The vast majority of Massachusetts residents have some form of health care coverage, but regardless of coverage status, out-of-pocket costs remain unaffordable," said AG Campbell. She added that the report provides policy recommendations to enhance affordable access and protect consumers from high medical bills.
Key findings indicate that lower-income households with employer-sponsored insurance face significant affordability issues. In 2022, these households spent more on cost-sharing than those enrolled through individual markets. For example, those in the lowest-income zip codes spent an average of $550 more on such expenditures compared to similar households with different insurance types.
Lower- and middle-income residents allocate a large portion of their budgets to premium contributions and out-of-pocket spending. In fully-insured plans, low-income households spent 13% of their income on premiums and cost sharing—five times more than higher-income counterparts—and an additional 39% on food and housing.
Vulnerable communities are disproportionately affected by hospital medical debt, particularly female, Black, and lower-income patients. Although hospitals offer financial assistance policies, these vary significantly and often exclude deductibles and co-insurance amounts.
The AGO suggests several measures to address these issues:
- Monitoring community-level payments against capacity-to-pay benchmarks.
- Strengthening consumer protections around providers' financial assistance practices.
- Increasing consumer protection concerning medical debt collection.
- Prohibiting medical debt reporting to credit bureaus.
- Supporting hospitals serving lower-income areas.
Previous reports focused on inefficiencies in healthcare spending distribution and burdens in lower-income communities. Last year's report dealt with ambulance service costs for non-network rides.
This year’s analysis was prepared by members of the AGO’s Health Care Division including Assistant Attorneys General Lisa Gaulin and Chloe Cable, Health Care Analyst Maeva Veillard, Lovell Fellow Ruchi Ramamurthy, Paralegal Gaëlle Bouaziz, and Chief Sandra Wolitzky.