Theo’s Story–Medical Bankruptcy

Theo was the manager of a large private estate where he worked for 17 years. His employer deducted income tax and social security from his paycheck. He did not, however, pay for Theo’s health insurance. Theo had looked at health insurance policies, the policies were too expensive. In 2005 Theo went to the hospital because he thought he had something stuck in his throat. The hospital ran some tests only to discover that he had had a series of small heart attacks and needed an angioplasty to insert a stent to clear the blockage in his heart. The angioplasty was $55,000.

Theo was too young to retire and needed to work to pay off part of the angioplasty bill. He had panic attacks because he did not have the money to pay his medical bills. He wanted health care insurance but now with a pre-existing condition he was unable to afford any health insurance he could get.

His employer did not want him working while he was taking the panic attack medications and terminated Theo. Because Washington State law declares it illegal to fire someone if they take medications, Theo hired an attorney. He received a small settlement.

Two years later Theo had a massive heart attack in 2007, but he still had no health insurance because of his pre-existing condition. This time his hospital bill came to $63,000. Theo found himself nearly bankrupt again from his medical costs.

He could not afford individual health insurance. He had some coverage and assistance through his partner Pete, but it was limited. They were able to have benefits for both of them even before same sex marriage because some employers actually permitted it. While he had to pay for his coverage he was able to get health insurance at the employee’s discount for $530 per month.

When his partner’s school closed in Seattle, however, they both lost their health insurance.   At $900 plus per month for health insurance because of his pre-existing condition, health insurance was out of the question for him financially.

In 2013, a year before the first consumer enrollment for the Affordable Care Act, Theo needed open heart surgery. He applied for Medicaid to help cover his costs but he and his partner would have had to sell their house to qualify for Medicaid. Even if he did qualify for Medicaid he still faced extensive co-payment costs. The hospital covered much of his costs through their uncompensated care program by paying for his portion of the Medicaid co-payments. Theo agreed to pay the hospital $50/month for the rest of his life to stay out of bankruptcy again.

Theo is not alone. In 2013, medical costs were the leading cause of personal bankruptcies, outstripping credit card debt and mortgage foreclosures. http://www.nclc.org/images/pdf/debt_collection/pr-cfpb-medical-debt-2014.pdf

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