By Noam N. Levey, Kaiser Well being Information
Kayce Atencio was haunted by a thought whereas working at a homeless shelter in downtown Denver. “It may have been me,” mentioned Atencio, 30, who lives in a small condo together with his son and daughter not removed from the shelter.
It practically was. Atencio and his kids for years slept on mates’ couches or stayed with household, unable to lease an condo due to poor credit score. An enormous cause, he mentioned, was medical debt.
Atencio had a coronary heart assault at 19, triggered by an undiagnosed congenital situation. The money owed from his care devastated his credit score rating. “It all the time felt like I simply couldn’t get a leg up,” he mentioned, recalling a lifetime of dead-end jobs and high-interest loans as he tried to remain forward of debt collectors. By 25, he’d declared chapter.
Throughout the nation, medical debt forces legions of People to make painful sacrifices. Many in the reduction of on meals, tackle further work, or drain retirement financial savings. For thousands and thousands like Atencio, the well being care system is threatening their very houses.
That’s confirmed notably devastating in communities like Denver, the place skyrocketing costs have put housing out of attain for a lot of residents and fueled a disaster that’s left hundreds homeless and sleeping on the streets.
On the Neighborhood Financial Protection Mission, or CEDP, a Denver nonprofit that helps individuals going through eviction or house foreclosures, about two-thirds of shoppers have medical debt, an off-the-cuff survey by KFF Well being Information and the group suggests. Near half of the practically 70 individuals surveyed mentioned medical debt performed a job of their housing problem, with about 1 in 6 saying it was a significant factor.
“All day lengthy I hear about medical debt,” mentioned Kaylee Mazza, a tenant advocate who staffs a CEDP authorized clinic on the Denver courthouse that gives help to tenants going by means of eviction proceedings. “It’s in all places.”
Nationwide, about 100 million individuals have some type of well being care debt. Of these, about 1 in 5 mentioned the money owed have compelled them to vary their dwelling state of affairs, together with shifting in with mates or household, in response to a 2022 KFF ballot.
A rising physique of proof reveals that secure housing is vital to bodily and psychological well-being. Some main medical programs — together with a number of in Colorado — have even begun investing in inexpensive housing of their communities, citing the necessity to handle what are generally known as social determinants of well being.
However as hospitals and different medical suppliers go away thousands and thousands in debt, they inadvertently undermine group well being, mentioned Brian Klausner, a doctor at a clinic serving homeless sufferers in Raleigh, North Carolina.
“Most of the hospitals throughout the nation that are actually publicly vowing to deal with well being inequities and break down limitations to well being are concurrently serving to to create these very issues,” Klausner mentioned. “No one likes the elephant within the room, however the actuality is that there are millions of sick People who’re doubtless homeless — and sick — due to medical debt.”
A Downward Spiral
Medical debt can undermine housing safety in a number of methods. For some, it depresses credit score scores, making it tough to get a lease or a mortgage. Final yr, about 1 in 8 U.S. customers with a credit score report had a medical debt listed on it, in response to the nonprofit City Institute.
Sufferers with continual medical circumstances could fall behind on lease or house funds as they scramble to maintain medical money owed in verify to protect entry to well being care. Many hospitals and different suppliers will flip away sufferers with excellent payments, KFF Well being Information discovered.
Denise Beasley, who additionally assists shoppers at CEDP in Denver, mentioned many older individuals, who sometimes rely most on physicians and drugs, imagine they have to pay their medical and pharmacy payments earlier than the rest. “The aged are terrified,” she mentioned.
For others, such debt can compound monetary struggles introduced on by an accident or sudden sickness that forces them to cease working, jeopardizing their well being protection or skill to pay for housing.
In Seattle, researchers discovered widespread medical debt amongst residents in homeless encampments. And people with such debt tended to expertise homelessness two years longer than encampment residents with out it.
Extra broadly, individuals with medical debt usually tend to say the debt has induced them to be turned down for a rental or a mortgage than individuals with scholar loans or bank card debt, in response to a 2019 nationwide survey of renters, homebuyers, and property house owners by actual property firm Zillow.
For Atencio, who left house at 16, his struggles with medical debt started with the center assault. He was working at a gasoline station and dwelling in Trinidad, a small metropolis in southern Colorado close to the New Mexico border.
Rushed to a neighborhood hospital, he underwent surgical procedure. The payments, which topped $50,000, weren’t lined by his well being plan as a result of he’d unknowingly gone to an out-of-network supplier, he mentioned. “I fought it as laborious as I may, however I couldn’t afford a lawyer. I used to be caught.”
Atencio, who’s transgender, has close-cropped darkish hair and a big tattoo on his proper forearm memorializing two mates who died in a automotive accident. Sitting on an getting older sofa in an condo with bars on the home windows, he’s philosophical about his lengthy journey from that medical disaster by means of years of debt and housing insecurity. “We’ve pulled ourselves out of this,” he mentioned. “But it surely took a toll.”
When Atencio’s credit score rating dipped near 300, the bottom ranking, there have been few locations to show for assist. Atencio’s relationship together with his mother and father, who divorced when he was 2, had been strained for years. Atencio acquired married at 18, however he and his husband hardly ever had sufficient to make ends meet. “I bear in mind pondering, ‘What sort of a begin to my grownup life is that this?’”
They have been finally taken in by Atencio’s mother-in-law. “If it wasn’t for her, we might have been homeless,” he mentioned. However getting out from the debt was agonizing.
“You find yourself on this cycle,” he mentioned. “You get into debt. You then take out loans to attempt to repay a number of the debt. However then there’s all this curiosity.” With poor credit score, Atencio relied at instances on payday lenders, whose excessive rates of interest can dramatically enhance what debtors owe. Many employers additionally verify credit score scores, which made it tough for Atencio to land something however low-wage jobs.
The job on the shelter was a step up, and Atencio this yr acquired the condo, which is reserved for single-parent households susceptible to being homeless. (Atencio separated from his husband final yr.)
Colorado’s Housing Challenges
Atencio’s housing struggles are hardly distinctive. Jim and Cindy Powers, who dwell in Greeley, a small metropolis north of Denver, noticed their very own housing goals collapse after Cindy was recognized with a life-threatening situation that required a number of surgical procedures and left the couple with greater than $250,000 in medical debt.
When the Powers declared chapter, the settlement protected their house. However their mortgage was bought, and the brand new lender rejected the cost plan. They misplaced the home.
Lindsey Vance, 40, who moved to Denver 5 years in the past looking for extra inexpensive housing than the Washington, D.C., space the place she was from, nonetheless can’t purchase a home due to medical money owed. She and her husband have a six-figure revenue, however medical payments for even routine care that she’s struggled to pay since her 20s have depressed her credit score rating, making it tough to get a mortgage. “We’re caught in a holding sample,” she mentioned.
In and round Denver, elected officers, enterprise leaders, and others have turn into more and more involved about medical debt as they search for methods to sort out what many see as a housing disaster.
“These items are deeply related,” Denver Metropolis Council member Sarah Parady mentioned. “As housing costs have gone up and up, I’ve seen increasingly individuals, particularly individuals with a medical points and money owed, lose housing safety.” Parady, who ran for workplace final yr to deal with housing affordability, helps lead an effort to get the town to purchase and retire medical debt for metropolis residents.
Fueled by skyrocketing costs and rising rates of interest, the price of shopping for a house greater than doubled in Denver from 2015 to 2022, in response to one current evaluation. And with rents additionally surging, evictions are rocketing upward after slowing throughout the first two years of the pandemic.
Maybe nowhere is Denver’s disaster extra seen than on the streets. The town’s downtown is dotted with tents and encampments, together with one which stretches over a number of blocks close to the shelter and clinic the place Atencio used to work. By one depend, metro Denver’s homeless inhabitants elevated practically 50% from 2020 to 2023.
CEDP, which was based to assist residents with housing challenges sparked by the pandemic, this yr joined different Colorado shopper and affected person advocates to push the legislature for stronger protections for sufferers with medical debt.
And in June, Colorado enacted a trailblazing invoice that prohibits medical debt from being included on residents’ credit score experiences or factored into their credit score scores, a transfer that put the state on the forefront of efforts nationally to develop debt protections for sufferers.
Just a few different states are contemplating comparable steps. And in Washington, D.C., shopper and affected person advocates are pushing for federal motion to restrict medical payments on credit score experiences. In most states — together with many with the very best charges of medical debt — sufferers nonetheless haven’t any such protections.
For his half, Atencio is hoping the brand new condo marks a turning level.
The house is modest — a small unit in an getting older concrete tower. There’s a safety guard by the entrance door and lengthy, linoleum corridors painted institutional blue and brown.
Atencio’s household is settling in, together with 4 pet rats — Sew, Cheese, Peach, and Bubbles — who dwell in a big cage in the lounge. “This appears like freedom,” mentioned Atencio.
He’s tried to provide his kids, who’re 5 and 11, a way of safety: home-cooked meals and the house to play or hand around in their very own bedrooms. Like mother and father in all places, he frets over their display screen time and rolls his eyes after they critique what’s for dinner. (They didn’t just like the potatoes he put in a pot roast.)
They’re all full-time college students: Atencio, who left his job on the shelter, is engaged on a grasp’s in social work. His son simply began kindergarten, and his daughter is in center college. “I’ve massive plans and massive targets,” he mentioned.
And with a number of thousand {dollars} of medical debt nonetheless to repay, Atencio mentioned he’s cautious to not take his youngsters to an out-of-network hospital or doctor. “I gained’t make that mistake once more,” he mentioned.
KHN (Kaiser Well being Information) is a nationwide newsroom that produces in-depth journalism about well being points. Along with Coverage Evaluation and Polling, KHN is without doubt one of the three main working packages at KFF (Kaiser Household Basis). KFF is an endowed nonprofit group offering info on well being points to the nation.