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Thursday, May 8, 2014

Personal Bankruptcy Rates as a Measure of Underinsurance (Cross Post with PUSH)

This is a Cross Post with the Healthcare for All PA/PUSH site on trends in medical bankruptcies and an update on decreases in Massachusetts mortality rates over the same period.

In my post on the Gallup polls on improvements in the uninsured rates.  I speculated that looking at the rates of medical bankruptcies would provide an indication of the number of underinsured in the US as the Affordable Care Act (ACA).  Data on the number of bankruptcies is available from American Bankruptcy Institute which distinguishes between the number of business and individual bankruptcies each year by state.  The reasons for individual bankruptcies is not given.  Research by PNHP has been done prior to the passage of the Affordable Care Act showing that medical bankruptcies account for 62.1% of all personal bankruptcies.  I have not found recent data on medical bankruptcies (filers or court records would have to be surveyed which is difficult to do) but I can look at overall individual bankruptcy rates in recent years.

The raw number of filings for each state can be seen here for the years 2007-2009.  The numbers were adjusted for state's estimated population for each year to allow for proper comparisons.   The rates are presented as bankruptcies per 1,000 persons.  The US rate increased from 2.70 in 2007 to 4.38 in 2011 which is a 62.15% increase.  The US rate did decrease from 2010 (4.91) to 2011 (4.38) as well as every state except Delaware.  The US rate is shown in the solid blue line above.

California and Arizona had the highest increases from 2007-2011 as can be seen in the table below.  Their increases were both by more than 220% (more than three fold) which is still staggering even after adjusting for their populations.  California is presented in the graph above in the solid black line. 

Of particular interest to health care advocates is Massachusetts (with the dotted purple line above) which has had a version of the ACA since 2006.  The bankruptcy rate there has increased by 43.05% which is below the national rate of 62.15%.  However, if the 50 states plus DC and Puerto Rico are ranked from highest to lowest it ranks exactly in the middle in the change in rate.

Our state, Pennsylvania, had one of the smallest increases at 10.24% (2.30 to 2.54) with a decrease from 2.98 to 2.54 from 2010 to 2011.  Vermont (the dotted yellow line), which passed a single payer plan to be implemented in 2017, had a 31.19% increase in its rate but still ranked 49th out of 52 states in it's 2011 rate.  Only Alaska, DC, and South Carolina had lower rates in 2011 than Vermont.  The state with the lowest rate of change is North Dakota at 1.69% (from 1.76 to 1.79) and is represented with the solid green line.

All of this begs the question how much of the increase in the rates are due to changes in health care or other factors.  There is no clear answer for that right now though the Massachusetts plan has not halted the rise in the overall rate in personal bankruptcies.  I will analyze this data for correlations with other rates such as the uninsured, health outcomes, and income to see if there is an association with these variables.



STATE
Population Adjusted Non Business Bankruptcy Rates by Year (per 1000 persons)
% change 2007-2011
2007
2008
2009
2010
2011
US (50 states + DC and PR)
2.70
3.49
4.55
4.91
4.38
62.15%
AK
0.92
1.18
1.28
1.46
1.30
41.27%
AL
5.04
6.15
7.18
6.98
6.20
22.92%
AR
4.02
4.69
5.51
5.46
4.83
20.02%
AZ
1.69
2.94
5.21
6.42
5.43
220.81%
CA
1.91
3.46
5.43
6.73
6.17
223.68%
CO
3.09
4.13
5.41
6.22
5.72
84.85%
CT
1.60
2.21
2.77
3.09
2.57
60.93%
DC
1.18
1.42
1.80
1.97
1.48
25.67%
DE
1.95
2.58
3.32
3.67
3.94
102.51%
FL
2.15
3.44
4.94
5.74
4.76
121.93%
GA
5.20
6.24
7.50
7.91
7.30
40.26%
HI
1.01
1.50
2.24
2.80
2.32
129.32%
IA
2.26
2.58
3.23
3.10
2.48
9.70%
ID
2.47
3.31
4.71
5.09
4.64
87.80%
IL
3.18
4.28
5.61
6.27
5.52
73.49%
IN
4.78
5.99
7.32
7.15
5.92
23.86%
KS
2.82
3.08
3.74
3.81
3.40
20.74%
KY
3.96
4.88
5.70
5.60
4.97
25.57%
LA
3.15
3.37
3.99
4.05
3.70
17.58%
MA
2.08
2.49
3.11
3.51
2.97
43.05%
MD
2.36
3.06
4.42
4.99
4.29
81.64%
ME
1.62
2.14
2.73
2.99
2.55
57.48%
MI
4.50
5.39
6.79
6.75
5.70
26.70%
MN
2.19
3.00
3.90
4.04
3.50
59.99%
MO
3.55
4.17
5.11
5.42
7.84
121.19%
MS
3.74
4.07
4.81
4.67
4.47
19.55%
MT
1.89
1.93
2.66
2.97
2.48
31.40%
NC
2.10
2.34
2.79
2.64
2.32
10.60%
ND
1.76
1.99
2.30
2.35
1.79
1.69%
NE
2.89
3.59
3.99
4.17
3.46
19.73%
NH
2.02
2.69
3.56
3.82
3.38
67.24%
NJ
2.20
2.96
3.96
4.54
4.17
89.40%
NM
1.64
2.17
2.86
3.05
2.63
60.35%
NV
4.09
6.86
10.74
10.78
8.64
111.38%
NY
2.05
2.36
2.80
2.77
2.41
17.87%
OH
4.29
4.93
5.96
5.97
4.97
15.78%
OK
2.41
2.93
3.66
3.84
3.35
38.89%
OR
2.45
3.28
4.67
5.12
4.42
80.58%
PA
2.30
2.53
2.80
2.98
2.54
10.24%
PR
1.99
2.32
2.93
3.24
2.96
49.04%
RI
2.56
3.94
4.68
5.06
4.55
77.52%
SC
1.61
1.82
2.04
1.93
1.65
2.55%
SD
1.61
1.73
2.18
2.37
2.16
33.85%
TN
6.32
7.47
8.43
7.73
7.18
13.47%
TX
1.70
1.69
2.05
2.14
1.89
11.16%
UT
2.42
3.39
5.20
6.41
6.32
161.58%
VA
2.44
3.52
4.46
4.51
4.04
65.77%
VT
1.33
1.96
2.40
2.53
1.75
31.19%
WA
2.34
3.22
4.56
4.88
4.52
93.54%
WI
3.06
3.69
4.76
5.18
4.64
51.73%
WV
2.37
2.79
3.50
3.18
2.48
4.61%
WY
1.42
1.44
2.27
2.64
2.33
63.97%

**Update**

The journal Annals of Internal Medicine compared mortality rates in Massachusetts to those in similar surrounding counties for four years before and prior to plan implementation in 2006.  They found a 2.95% decrease in the mortality rate compared to the surrounding counties from 2007 to 2010.  Over the same period Massachusetts had a 68.75% increase in the rate of bankruptcies.  

I could not access the journal article so I do not know what the control counties were.  However Rhode Island and Connecticut are similar states in demographics.  Rhode Island had a 97.65% increase and Connecticut had a 93.13% increase in the personal bankruptcy rate.  Is the lower increase in Massachusetts bankruptcies due to their health care law?  I cannot say.  The national rate increased 81.85% over the same period.  There can be many other factors at play in these three states such as differences in bankruptcy law.

Parts of the ACA were implemented in 2011 and there was a 10.79% (4.91 to 4.38 bankruptcies per 1000) decrease nationally from 2010 to 2011.  The slight decrease in the national rate could be due to slight improvements in the economy.  Mortality is a lot easier to measure than bankruptcy.

**Related Posts**

The Affordable Care Act Having an Impact in Some States but not Pennsylvania


 


National, State, & County Uninsured Estimates


 


The Affordable Care Act (ACA) having little effect on PA's Uninsured Rate So Far

 

An Explanation of Washington Post Graphs on the Cost of Procedures