1 in 8 Mass. residents carries family medical debt despite near-universal insurance coverage

Massachusetts often touts its near-universal health insurance coverage, mandated through a 2006 state law. But a new report shows that despite the assumed financial protections for residents, 1 in 8 residents carries family medical debt.

The report, released this week by the Center for Health Information and Analysis, found 88% of those with medical debt incurred it while all family members were insured — showing insurance doesn’t necessarily protect against debt.

It does, however, make it less likely. The report said that without continuous insurance over 12 months, families were nearly twice as likely to have medical debt than those with all household family members continuously insured.

The report comes as Congress has yet to extend Affordable Care Act enhanced premium tax credits that are expiring Dec. 31. If federal lawmakers don’t take action, 337,000 people in Massachusetts insured by the marketplace will see their monthly premiums increase as a result.

The potential expiration is on top of base-level premium increases — increases proposed by health plans and approved by state regulators. A recent Kaiser Family Foundation analysis estimated that base premiums for Affordable Care Act plans will increase by an average of 26% nationwide in 2026.

As part of an agreement to end the federal government shutdown, Republicans agreed to a vote on health care — likely the tax credits — in early December.

Medical debt is linked to a spiderweb effect, the report details. It can cause people to forgo needed health care, become food insecure or experience housing instability. It may cause them to dip into their savings, 401K accounts or come into contact with a collection agency.

The Center for Health Information and Analysis report broke down the major drivers behind the reported debt, including deductibles, copays and coinsurance, and care not covered by insurance. Enrollment in high-deductible health plans — where people pay less in monthly premiums but more for care in the long-run — more than doubled between 2015 and 2023 from 21% to 45%.

It also highlighted that Black Massachusetts residents are more likely to report medical debt than their white neighbors (20.6% vs. 13.9%). Also disproportionately impacted are residents with family incomes from 139% to less than 500% of the federal poverty level.

The report noted the lowest-income families have a lower likelihood of medical debt presumably attributed to MassHealth’s elimination of all copays and cost-sharing for members in that income bracket.

Lora Pellegrini, president and CEO of the Massachusetts Association of Health Plans, said the new report “highlights the troubling reality that medical debt is a symptom of the growing affordability crisis in our health care system.”

In her statement, Pellegrini cited broader system-level challenges, including provider prices, rising costs of prescription drugs, billing practices, and societal factors such as health status and income.

“Meaningful, lasting progress will require solutions that confront the underlying drivers of health care costs and ensure that care remains affordable for every Massachusetts resident,” she said.

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