Many Americans continue to struggle with the economic problems created by the Great Recession of 2008. As a result, many scientists have begun to explore the link between financial setbacks and health care or health status.
Recognizing that the medical literature offers very little information about the effect of household debt on needed care, Sarah Burgard, PhD, and her co-author Lucie Kalousova, PhD, investigated the choices people make when living with credit card debt, medical bills, and other types of loans.
An alumna of the Robert Wood Johnson Foundation (RWJF) Health & Society Scholar program (2003-2005), Burgard has broken new ground with her findings. “I think we are the first to look at specific types and amounts of debt in great detail, making it possible to look at the connection between each type and the likelihood that people will do without their medication in order to pay these bills,” she says.
“This research evolved from some of the work I did as a Health & Society Scholar. During the program, I began looking into how employment and financial instability relate to health care,” says Burgard, an associate professor of sociology and epidemiology and research professor of population health at the University of Michigan.
Balancing Competing Needs
As of 2012, 77 percent of American households were holding debt. Debt burdens have grown dramatically as borrowing has increased. In addition, 56 percent of credit card holders (75 percent of Americans) are unable to pay their balances in full each month.
Yet, the debt/medical expenditure equation is a complex relationship that depends on such factors as the type of debt held and the debtors’ resources. “We found that debt colloquially referred to as ‘bad debt’ is the type that matters when it comes to medication adherence,” Burgard explains.
Using a unique database (the Michigan Recession and Recovery Study) of one-on-one interviews with a racially diverse group from southeastern Michigan, Burgard and Kalousova included 434 people, ages 19 to 64, in their research. Each study participant had been prescribed medication. Many also reported chronic illnesses or episodes of depression.
Thirteen percent of study participants said they had skipped doses of medication or cut pills for cost reasons during the past year.
In the published analysis of their work “Tough Choices in Tough Times: Debt and Medication Nonadherence” (the journal Health Education & Behavior, July 2013), Burgard wrote “…nearly 95 percent of study participants had some type of debt and more than 13.1 percent said they had skipped doses of medication or cut pills for cost reasons during the past year.”
But as study participant’s told their stories, it became clear that certain types of debt—often thought of as “good debt”—seemed to actually be a proxy for middle-class status. “Medication adherent individuals were more likely to hold this ‘good debt’ in the form of mortgages, student loans, car loans, and have higher incomes and levels of education,” Burgard says.
“Medication nonadherent study participants were far more likely [68% vs. 24%] to have medical debt or credit card debt—often thought of as ‘bad debt.’ They were also more likely to lack medical insurance and to experience depression.”
A Link to Disparities
“For the people in our study the persistence of debt related to expenditures for medical care was very consistent among the people with the fewest financial resources,” Burgard explains. “Our work underscores the important role that health insurance coverage may play in keeping people from accumulating debt from medical treatment.”
On a positive note, Burgard thinks that the expansion of health insurance coverage through the Affordable Care Act may help alleviate the debt/medication nonadherence link for many people who are currently uninsured, but she also calls for change.
“We need to think about the way we use debt in this country and how we treat people who have overdue bills or loans,” Burgard advises. “Debt forgiveness programs for certain types of debt—such as unmanageably large, unexpected medical debts—may be a way to stop a vicious cycle for some low-income individuals. If these debts lead them to do without needed medications or medical care, their health could decline further, creating more costly problems in the future. Debt is clearly an unexplored aspect of socioeconomic status that puts people at a disadvantage in terms of their health.”