Medical Debt Reflects a System That Demands Navigation, Not Luck

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Medical Debt Reflects a System That Demands Navigation, Not Luck

October 30, 2025

Some 100 million Americans are living with some form of medical or dental debt. For more than 15 million, that debt exceeds $1,000. Reports from MSNBC and KFF Health News highlight that this burden affects individuals across all age groups, geographic regions and insurance statuses. Many individuals in debt are insured, employed and making responsible choices for their families. Yet, they remain vulnerable to the unpredictable economics of a system that often defies transparency and coordination.

Medical debt rarely arises from poor household decision-making. It is often rooted in circumstances beyond our control, such as a sudden illness, an injury, or a chronic condition. Even families who plan, save, and purchase sufficient coverage can find themselves navigating a maze of hospitals, providers, insurers, and intermediaries (e.g., pharmacy benefit managers, or PBMs) whose incentives are not always aligned. In this ecosystem, confusion becomes costly; the system functions, however, not necessarily centered around the people it is meant to serve.

Persistent Burden of a Fragmented System

The KFF Health Care Debt Survey found that four in 10 U.S. adults carry some form of medical debt. Many face collection actions or delay additional care for fear of compounding their balance. These statistics reveal more than individual hardship; they expose deep structural fractures in how American health care is financed and experienced.

At its core, the U.S. health ecosystem remains highly skilled and yet very fragmented. It is a network of disconnected sectors that often operate to serve different customers. A patient may receive one bill from a hospital, another from an anesthesiologist, and a third from an imaging group, each governed by distinct financial rules. The result is not a single episode of care, but rather several, each with its own separate logistical hoops (and surprise) price tag. When reimbursement models reward volume (i.e., fee-for-service) over outcomes, fragmentation becomes the invisible and unintended architecture of inequity.

Who Are the 100 Million Americans With Medical Debt?

News headlines reveal a striking diversity of circumstances. Data from non-partisan experts, including the KFF, Urban Institute, and the Consumer Financial Protection Bureau, reveal overlapping groups that mirror America's broader challenges.

• The Working Insured. A majority of people with medical debt have coverage through their employers or the marketplace. High deductibles, coinsurance, and narrow networks expose middle-income families to surprise bills; a single event can create debt that lingers for years.
• Low-Income and Underinsured Families. Past-due medical bills are concentrated among households with annual incomes under $50,000, especially in states that did not expand Medicaid. Many fall into a coverage gap: too poor for subsidies, ineligible for traditional Medicaid.
• Communities of Color. Black adults are about twice as likely as white adults to have medical debt in collections; Hispanic adults face higher exposure due to coverage gaps and language or documentation barriers. Employment in sectors with limited benefits compounds risk.
• Rural Americans. Debt rates are highest across parts of the South and Appalachia, where hospital closures and limited networks magnify financial exposure. In some rural counties, nearly 40% of residents have unpaid medical bills listed on their credit reports.
• Older Adults and Caregivers. Adults ages 50-64, too young for Medicare and often managing chronic conditions, are a fast-growing segment. Many also support aging parents or adult children, amplifying the burden.
• People With Chronic Conditions. Individuals managing diabetes, heart disease, cancer or mental health conditions face steady out-of-pocket costs for medicines with high co-pays that accumulate into lasting debt.

Behind each statistic is a teacher with a surprise MRI bill, a gig-worker uninsured between contracts, or a caregiver paying long-term care expenses. Together, these stories humanize the number: 100 million Americans navigating a system designed for transactions, not understanding.

Early Warnings: Insights From the FINN Futures™ Health Survey

Nearly a decade ago, the FINN Partners Futures™ Health Survey (2016) highlighted these warning signs. The national study found that almost half of all insured Americans had changed health plans within three years, and many had also switched primary care physicians. It concluded that the U.S. system "forces consumers to navigate medical care on their own, putting convenience and cost into the forefront of decision-making." Frequent plan turnover and inconsistent provider relationships erode continuity, raising the risk of errors and unexpected expenses. Patients were becoming the de facto integrators of their own care, responsible for managing their own medical histories, reconciling bills, and advocating for themselves in a complex healthcare system.

From Critique to Navigation: Designing for End-Users

Tackling medical debt and the fragmentation beneath it presents an opportunity for health communicators from the health system to health innovators to design everything with the end-users of the system in mind. Who? The people seeking care and the providers who guide them. The work is not message-pushing; it is a collaborative journey-building across prevention, diagnosis, treatment and recovery.

• Clarity-first communication. Replace jargon with plain language "what to expect" guides at every touchpoint: coverage, referrals, prior authorization, likely costs, and next steps. When information is clear, people act earlier, a prerequisite for prevention and adherence.
• Continuity through consistent signals. Attune messages across channels, including health systems, payers, pharmacies, biopharmaceutical companies, and community partners, so that the information unites the community around people - patients and caregivers - and appears in portals, discharge summaries, texts, and benefits materials. Message consistency is a form of care coordination.
• Provider-enablement as a core deliverable. Equip care teams with brief, scripted explanations for common friction points (e.g., network status, cost-sharing, site-of-care shifts), plus visual handouts and digital templates they can personalize in seconds. When providers can explain the path forward, patients stay engaged. AI and LLMs will increasingly play a significant role in delivering personalized information to patients and customers.
• Prevention-anchored narratives. Tie every interaction to prevention and earlier intervention from screenings, immunizations, and chronic conditions to check-ins. Show how timely steps reduce both clinical risk and financial exposure for households and private and public payers.
• Navigation assets, not just campaigns. Build tools people can use, checklists for pre-visit questions, "know your benefits" one-pagers, cost-estimate explanations, and appeal-process roadmaps. Place them where decisions are made, such as in portals, waiting rooms, employer intranets, and community clinics.
• Community conduits. Partner with pharmacists, community health workers, faith-based leaders, and local employers to deliver the same, simplified guidance in trusted settings. Community messengers help close equity gaps that media alone cannot. At a time of cost-cutting, consider the reality: Disease is far more costly than prevention or treatment.
• Feedback loops that fix friction. Treat call-center transcripts, portal searches, and denied-claim FAQs as design inputs. Where confusion clusters, redesign the content and the process. One major insurer has announced that it will now deploy AI platforms to accelerate prior authorization decisions. That is a long-needed step in the right direction.

This is access-centered communication, offering customers, the end-users, the information architecture to move confidently through the care process. When people and providers share a standard, comprehensible map, debt diminishes, adherence rises, and prevention becomes possible.

For many households, the greatest health risk is no longer illness itself but the administrative complexity surrounding it. A person may assume a hospital stay is covered, only to find that an out-of-network specialist billed separately. Deductibles reset annually, formularies shift, and cost-sharing rises faster than wages. Independent evaluations, including those by Mathematica, have linked care fragmentation to higher emergency department use and rehospitalization. When coordination falters, costs rise and outcomes suffer, financially and clinically.

A Culture of Shared Accountability

Medical debt is a mirror reflecting both the system's complexity and society's inequities. The tools to change this reality already exist: interoperable data, transparent pricing, aligned incentives and access-centered communication. What remains is the will to collaborate.

Hospitals, insurers, life-science companies, employers, and public agencies can simplify the journey by prioritizing transparency, coordination, and continuity of care. As the FINN Futures™ study emphasized, the burden of navigation should not rest solely on the patient.

In a nation where more than 100 million people owe medical or dental debt, the challenge is not only affordability, but also comprehension. The path forward lies in partnership. That calls for a collective effort to make navigation intuitive, equitable, and humane so health care delivers healing without harm and care without crisis.

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POSTED BY: Gil Bashe