on a harvard study which examined two thousand one bankruptcy filing date in five select judicial districts around the country that study concluded that illness or high medical bills contributed almost half of all the bankruptcy filings that were studied today we revisit the issue of medical debt as a contributor to bankruptcy the authors of the study have now released an updated version published online last month the american journal of medicine based on two thousand seven data bankruptcy filings nationwide disturbingly this study concludes that sixty two percent of bankruptcy debtors can trace at least part of the cause of their bankruptcies to medical debt two thousand and seven data also indicate that there was a nearly a fifty percent increase in medical bankruptcies as a proportion of bankruptcy filings between two thousand and one two thousand and seven the updated study further suggests that medical debt is robbing middle class families  bankruptcy of those classified in the study is medically bankrupt more than sixty percent attended college more than sixty six percent at one point owned a home and seventy eight percent had health insurance at the time they became sick or injured accordingly it's obvious that medical bankruptcies are not the fault of people keeping track of their assets and liabilities they are the victims of life's lottery ultimately the problem lies with the runway runaway cost of health care in america simply too expensive for millions of americans to buy any health insurance at all and even for those who have insurance excessive premiums and deductibles low coverage caps and uninsured medical conditions are just some of the reasons why americans with health insurance are left one serious illness away from financial disaster and when that financial disaster may hit it hits hard studies show that many are skipping recommended treatments not filling critical prescriptions pharmacist postponing doctor appointments and cutting back on other essentials like food in order to stay financially aloft often the debt becomes that americans are faced with no other choice but bankruptcy and medical bankruptcies have a collateral effect on creditors because when you have a medical bankruptcy all creditors lose which means small business loses which is an important reason why small business and creditors in general benefits by health care system that doesn't drive american citizens into bankruptcy where we lose the opportunity to collect on lawfully owed debts it is my sincere hope that today's hearing will help us better understand extremely serious consequences of medical debt and serve to galvanize us to work toward finding solutions i welcome ideas from many of the bankruptcy code to help provide needed relief for the medically bankrupt and i'm certainly open to revisiting some of the more onerous provisions of the two thousand and five bankruptcy abuse prevention and consumer protection act and in particular the means test and the credit counseling requirement credit counseling certainly can't help a person who has gone into bankruptcy because they have a major medical problem that is something that may be a check up with a doctor to do more good and the credit counseling becomes waste time perhaps this could achieve a better balance in creditors rights and the need for relief for honest medical debtors in addition to exploring bankruptcy law changes i believe the long term solution to runaway health care costs meaningful health care reform it would be remiss if i did not recognize the leadership of the distinguished chairman of this committee the honorable john conyers he is wrong attention to this important issue over the years and i applaud him for his efforts to bring about legislative change in the medical field and for universal coverage the updated harvard study should be your useful reminder as to why congress must consider refining the bankruptcy code and reforming our health care system to provide much needed relief to those with overwhelming medical debt not to do so would be a crime i thank the witnesses for prayed today and i look forward to their testimony i now recognize my colleague mr frank the distinguished ranking member of the subcommittee for his opening remarks well thank you mr chairman and thank all of you for being here another wonderful day in the capital here and we're glad that we can go forward here thank you mr rogers absolutely it's a wonderful day in the neighborhood it's a great day the question this hearing titled presents is our health care system bankrupting americans quote it's relatively easy to answer in my opinion that that answer is no the empirical evidence aside from the one harvard study the university study the chairman has mentioned demonstrates there's been no increase in the number of bankruptcies caused by medical debt medical bills and medical problems mr chairman to be sure are indeed a source of deep concern for many american families and unfortunately in some cases these problems lead families into bankruptcy but this is why the bankruptcy code allows low income debtors to discharge their medical debts completely and higher income debtors to pay back only what they can afford in short the bankruptcy code already tries to strike an appropriate balance between debtors and creditors including health care providers and i believe it's unwise to change that mechanism government run health care system that really is at the top of the majority's agenda  i think is the main reason we're here today not really to talk about the reforms of the bankruptcy code i suspect that we are here to discuss why a new harvard study a medical debt and bankruptcy should lead us to conclude that this country needs a government run health care system there at least two problems with that argument since medical debt plays a significant role in banks ruptured filings we need therefore government run health care and other words we make that leap but first the harvard study that is the foundation for this argument is fundamentally unsupportable the study's findings rest primarily on the way researchers define and count what constitutes a medical bankruptcy instead of on an actual increase in medical debt related bankruptcies and even assuming the researchers methodology is correct in absolute numbers medical but debt bankruptcies actually decreased between the years of two thousand and one in two thousand and seven yet by using percentages instead of actual numbers the researchers plane the medical debt bankruptcies increased during that same time period moreover mr chairman no other study of medical debt in bankruptcy has reported a correlation anywhere near as the sixty two percent correlation the harvard study finds the second and perhaps most important in terms of decreasing the number of bankruptcies in america there's little reason to believe that a government run health care system w have much of an impact one only needs to look at candidates to see why this is true according to a study by the fraser institute the consumer bankruptcy in canada was higher than the bankruptcy rate in the united states in two thousand and six and two thousand and seven despite the fact that canada has a universal single payer payer government run health care system so i said long time ago the smart man learns from his experience a wise man learns from other people's experience and i hope that we will look to other people's experience with that with a government run health care if we had government run health care like canada has mr chairman we're still looking at canada's having a higher bankruptcy than we do in the last couple of years it's projected that the health care legislation majorit es trying to move through congress will eliminate up to five million jobs certainly lost a five million jobs will have a far greater impact on the number of americans filing for bankruptcy than medical debt even using a harvard studies inflated numbers every american regardless of health or financial status should have access to affordable health care and the coverage in my opinion of their choice but we should not be making decisions on how to improve america's health care system based in any part on a flawed medical debt bankruptcy study nor will should we use that study as a bankruptcy for modifying the bankruptcy code mr chairman i heard that if you have a cold in canada you call a doctor if you have something serious you call a travel agent so i just thought i'd throw that in while we're walking by this way i look forward to the witness's testimony and you go back about some i've done i thank the gentleman for a statement and since he did reference that the chairman there i would would want him to know that we are not bashing our health care program after canada and we have a much warmer and fuzzier system we plan and we do in ten americans we sure will continue to call their travel agent to go to canada which is a nice place to travel to i now recognize our distinguished if you disagree committee chairman  normally applause is not allowed but for the chairman it's encouraged but well this is a good way to start a hearing because i wanted my dear friend the ranking member mr franks very zona to get all of these so opposing problems out of his system and get them on the table so we can examine them this is almost like a medical diagnosis that we do in the legislature we find out what's wrong how you're feeling and what you believe and we lay it out on the table and then we start talking through it and that's that's what brings us here today i've rarely been in a room and a hear virginia bobby scott and of course mel watt himself and what we want to try to do is examined these inside this bill and we'll be talking about it in addition i do celebrate the fact that our colleague from senate was able to get through an amendment that allows states to use single payer to experiment with it which they cannot do now without this amendment and i'm fighting to keep that in the bill so i look forward to the proceedings i want to i want to tell my friend from ohio jim jordan that i sent my congratulations to him this morning and i'm glad you did it because  have to work together the essence of democracy isn't how much you can diss the other person personalize attacks and misrepresent fact colleagues in welcoming elizabeth edwards i don't really know of a more public and oughtn't and thoughtful advocate in the health care spokes person for health care reform and i'm looking forward to her testimony as well as the other witnesses i don't i don't mean to discount anybody's testimony  about this important subject we actually have a number of different standards in the bankruptcy laws for a number of different things i've got a whole section on on  systemic threatening financial institutions that wouldn't be part of the regular bankruptcy code there are all kinds of exceptions and and yet there's no real then the four minute market turns yellow and the yellow brick road leads to the red sign which means your time is up most people don't pay attention to that but we would hope that we start to pay attention to that little bit and start to wind up your marks at a minimum when it gets to be read tireless worker on behalf of important social causes for many years she worked in the north carolina attorney general's office in the early eighty's and worked the department of natural resources development and seat from eighty four to ninety six she was in private practice and she worked in bankruptcy courts particular relevant for us here she taught at the u n c law school for two years and she was a member of the first group of public fellows the college of arts and sciences at the university north carolina th chairman callinan members of the subcommittee thank you for inviting me here today discuss the problems individuals face when they cannot afford health insurance or health care as a person who has spent the majority of her legal career in bankruptcy court representing bankruptcy trustees and as someone who has her post legal career dealing with health care policy i have to disagree with the congressman the answer the question posed by this hearing is yes our health care system is bankrupting america we're in the middle of a great national debate on health care for the first time in fifteen years we are truly trying to fix a problem of a broken health care system to deal with the twin problems of the status quo which rocketing health care costs and millions of americans living without adequate health care coverage i know is particularly interested in the financial hardships that many americans experience due to health care costs people with poor health insurance coverage or no health insurance coverage and a significant health problem are particularly likely to accrue considerable medical debt and are thus particularly vulnerable to bankruptcy medical debt is a symptom of larger problems in our health care system and although we can take some ameliorative steps the real solution to medical debt and medical bankruptcy is real health care reform that results in affordable reliable insurance coverage for all americans the problem can be pinpointed further as problem of insurance coverage which is unavoidable for forty seven million americans and the sadly people who even have health insurance increasingly face problems paying for health care seventy five percent of those filing for bankruptcy had because of medical debt have health insurance obviously inadequate health insurance some of these are part of the twenty five million adults in america with commonwealth fund identified as under insured even moderate levels of out of pocket spending relative to family income created medical bill problems because many families have little wiggle room particular in this economy within their family budgets for large unexpected out of pocket health care expenses so another study found that one in five twenty percent of us reported problems paying medical bills and that was in two thousand and seven i don't expect it's gotten any better health care affordability is particulars of for individuals with chronic illnesses and other conditions that require ongoing often costly medical care in particular individuals who are older have activity limitations have chronic conditions such as diabetes heart disease arthritis or have experienced a stroke are more likely to spend a higher proportion of their income on health expenses so this problem of medical debt hits the most vulnerable people at the worst possible time of sick or uninsured adults three cis reported being contacted by a collection agency two thousand and seven survey respondents reported making difficult choices between using up a lifetime of saving running up credit card debt often to cover those medical costs skipping the purchase of other necessities or adding a mortgage against their home in order to pay medical bills so broader financial problems which are often masked  and in some statements are another hazard on insurance or under insurance many medical debtors turn to borrowing to cover accrued medical expenses in order to continue treatment which is why the study that was done by harvard is so illuminat and continuing treatment by maybe their highest priority in fact probably should be their highest priority for example a recent debtor in north carolina this was just last week incurred medical expenses for a child who needed cardiac surgery a large part of the cost so he was insured a large part of the costs were not covered by the insurance policy he borrowed money against his credit cards in order to pay for that first surgery but that wasn't his worst problem like many medical debtors the surgery was the beginning not the end of the treatment costs that had been borne by this particular debtor to pay for his child's cardiac surgery and the father was forced into bankruptcy the need for continuing care from the health care provider slash creditor puts these particular kinds of costs in a unique category in our bankruptcy in some cases bankruptcies may be driven not by under insurance or by bad and made by insurance but in fact by bad insurance policies those who suffer from wrongful rescission or denial of legitimate claims include not only the debtor who is obviously disadvantaged but also as the chairman mentioned disadvantages other creditors particularly unsecured small business grow by the inclusion reimburse costs in the bankruptcy filing the problems i've outlined in my testimony families forced into bankruptcy people with chronic conditions going into going without necessary care or low income families experiencing squeeze of unexpected medical bills are merely a symptom of our larger problem in our hundred people in bankruptcy courts who we surveyed the most recent one has twenty three hundred debtors in bankruptcy court in that most recent study medical bills and almost contributed to as many people said sixty two percent of  bankruptcies and the proportion of bankruptcies attributed medical problems rose by about fifty percent that striking conclusion from the study is really that private insurance is a defective product it's a defective product it leaves m of middle class americans vulnerable financial ryan and unfortunately the health reforms now under consideration in the house would do little to address this grave problem that is reforms other than single payer they will not address the problem we found that most of  medical bankruptcy were middle class at least when the financial crisis hit two thirds will homeowners three fifths gone to college how medical bills were part of a web of problems often they lost a job because they were ill and with it lost their insurance just as the bills started to roll in as we've mentioned before the overwhelming majority of those in bankruptcy had health insurance seventy eight percent were insured at the start of the bankrupting illness in the majority of them actually had private club bridge and the majority of those actually held on to their coverage throughout the bankrupting illness but bankrupted anyway by co payments deductibles and gaps in coverage which will continue to be legal in the the house bill these families have done everything right they worked hard paid their premiums and thought they were covered yet on average they ran up bills people with private insurance ran up bills of nearly eight hundred thousand dollars including folks who held on to insurance throughout the illness so this is not an issue of resurgence illness that private health insurance is fundamentally defective i think our study raises a warning flag that leaving most americans to rely on private insurance is going to leave them unprotected and unfortunately a public plan option that mimics the rules and coverage of private plans won't help at all still have those co payments deductibles and other gaps now in massachusetts we have three years of experience with the kind of plan the house is now debating and it's actually pretty sad experience reform has not made health care affordable for a middle class and has decimated decimated the safety net on which poor people are mentally ill people continue to rely in two thousand and seven only five percent of massachusetts residents were uninsured that was the lowest rate in the nation and yet medical problems in two thousand and seven were still responsible still under like three out of every five bankruptcies essentially the same proportion as nationally in our state fair to buy insurance is illegal punishable by one thousand dollars fine which is the same fine you get for beating your wife for making a terrorist threat for middle income fifty six year old the chief of coverage available through the state's connector and you can go on the state's website to see the state's insurance exchange alpha's your policy forty nine hundred dollars for a policy with a two thousand dollars deductible before it pays for it here and twenty percent co payment after that that's going to be a what does being proposed in the house bill is identical to massachusetts a diabetic with such call verge would quickly run up bills of about ten thousand dollars of you a year and in two years he to cumulate bills large enough to bankrupt them if he was like the people in our study this kind of insurance sold with the stamp of approval of our stay in a form similar to one you're considering stamp of approval of the connector is a cruel joke and congress should not repeat that for everyone financially ruined by illness many more physically suffer because they can't get the care they need access to insurance policy is not same thing is access to  eighteen percent of people our health care last year because they couldn't afford it we're supposed to be the model eighteen percent here because they couldn't afford it moreover if those people show up the safety net hospitals and clinics they're going to find them shuttered are cutting back on services our governor and legislature desperate to keep the reform afloat as cost of escalating more rapidly than predicted it has drained funds from that reform needs to replace the defective private insurance that most families have affordable by saving literally hundreds of billions of dollars every year that we now waste in insurance overhead bureaucracy in nations like canada that have single payer health plans medical bankruptcy is about twelve percent of all bankrupt unfortunately overwhelming evidence indicates that the house now seems poised to pass will fail to protect americans unless it gets rid of the defective product that is private health care private health insurance will have private health care but no private health insurance with a single who writes about taxes and wages and she's also been a consultant to the world bank and taught economics at the university of maryland her work ranges from research on carbon taxes the impact of state health insurance mandates on small farms to labor market outcomes for research on corporate taxation and distinguished member of strength you forgiving the opportunities desta fired today in my testimony i will explore the extent to which household medical debts can be held responsible for consumer bankruptcy filings in recent times the debate surrounding the topic has become particularly heated with studies claiming that more than sixty percent of all bankruptcies medical bankruptcies while sympathetic to the plight of these families in tough economic times i believe that to positively inform and steer the debate we need to disentangle the rhetoric from the fat my own analysis of micro from nationally representative government thousands of american families with several years has led me to conclude that the extent of the problem is being overstated and therefore misdiagnosed a rise in medical bankruptcies should show up in the data as a rise in medical debt the most extensive nationally representative data on medical debt is available from the soviet consumer finances this data shows that medical debt the credit god deaths have risen over the spirit level while indebtedness in general may be a problem medical indebtedness is not other surveys linking medical deaths and bankruptcies read similar  department of justice is executive office of the united states trustee examine the records of proximity five thousand bankruptcy cases filed between two thousand and two thousand to more than fifty percent of the cases listed no medical death in only ten percent of the sixteen percent of all bankruptcies so the data however need to be integrated with caution in order to draw the right inferences we need to apply the correct methodology to the server using more rigorous multivariate regression analysis the most important cause of bankruptcy filing so why do they himmelstein and colleague surveys conclude that nearly sixty two percent of filings and medical leave it there are several reasons listed in my longer written testimony i will talk about a couple of those here the michigan law faculty in two thousand and three prior to coming there he worked at several law firms doing predominately bankruptcy work practice focused on data representation in chapter eleven restructuring licenses  what i thought i might do is quickly speak about some of the academic studies you're going to be hearing about when you work through these difficult health care issues to see if i can provide some guidance cutting through the morass of numbers and then if i have time which is unlikely i'd like to share some of my own data on the rising problem of elderly americans elder americans who are filing for bankruptcy and an alarmingly increasing rate the first thing i'd like to do is talk about some of the methodological issues of bankruptcy filing and medical bankruptcies and i think the single most important thing i'd like members of this committee to think about is that an academic study that distinguishes between something called a medical debt and a medical bankruptcy and then take something like a credit card and calls that and other bankruptcy is entirely missing the point there is no artificial distinction in the real world and i can say this from academic research i can say this from doing consumer pro bono cases but i still get my license for there is no distinction between a medical debt and a credit card debt you are allowed to charge co payments and hospital bills on your credit card so if you base an academic study on looking at court records and you read the list of the creditors and it says st jude's hospital you say oh that's a medical identity of those debts and simply use crude categorizations of credit cards secondly and relatedly i think that there's a misandrous and some studies on the idea of medical debt so loan as the only way of gauging what a medical bankruptcy is so from a and this just maybe risk reflect different academic disciplines of economists versus law but what legal scholars are interested looking at is are people going bankrupt through no fault of their own because there was much discussion in the bankruptcy debates about whether people were shifty games been trying to game the bankruptcy system or they were just playing by the rules and went bankruptcy through bankruptcy no fault of their own and so from that perspective we don't really care whether someone went bankrupt because they had a heart attack and then had to reduce their work hours or had a heart attack and then had very expensive bills to pay for that heart attack they both of those people went bankrupt for reasons for which they should not be blamed and should receive protection now even if i were to grant the distinction and say well the first guy who went bankrupt was the hardest at best is his tough luck in his his battles but that's not a problem with the health care system that's just a problem with his healthiness level i'm not even sure i would grant that concession i'm not sure that makes logical sense to me because the reason one might have a medically caused bankruptcy like a heart attack could simply be because you haven't had your blood pressure checked for ten years or twenty years and you never want to see a doctor because you had insufficient medical insurance in the first place had you had proper health insurance you might have had preventative medical care that could've prevented that medically caused bankruptcy in the future so i guess i would caution against these artificial distinctions that i think really miss the forest for the trees the next thing i want to talk about briefly is is what i call in a pistol the logical conundrum of people really fighting over is it twenty nine percent or is it thirty nine percent or is it sixty percent i think it's important i think it's important and not demick level but at the broader level of congressional policy my testimony is it's too high whatever you use as the most conservative  metric if you please if you if you even take the most you know the conservatives are just people who sat on questionnaires why did you go bankrupt health reason you're still looking at numbers that are over thirty percent and that the that's a lower bound which is simply  high now in my own data which i which i've just run i haven't i haven't eric checked yet if i look at just elder americans people who are over sixty five and i use dr will handler's thresholds of defining medical bankruptcy so i don't want to get to where that's right when i just i want you to compare apples to apples we're seeing people on my questionnaire forty six percent of elderly bankruptcy filers said they filed bankruptcy for medical reasons thirty two percent said they filed bankruptcy because they had medical bills someone psyching either of those two choices they either take my medical bills or do i or any medical problem that's forty nine percent of elderly bankruptcy fathers that's particular disturbing for two reasons number one the elder americans are the fastest growing rate of bankruptcy followers in one thousand one they were two percent in two thousand and one they were seven percent in two thousand and seven they are now are now seven percent if i take that as fifty five and older in two thousand and seven they're twenty two percent so concern number one to the fastest growing group concern number two was look at medicare if you're over sixty five you should have i mean there are some who don't qualify but the lion's share of people over sixty five in this country are supposed to have a government funded health insurance program last thing i want to say is please be careful academic studies i'm not faulting you sir for growing that fr but that's already been discredited you can go to a blog called credit slips and read the post by professor lawless but that fraser institute said look the bankruptcy filing rate in canada's higher look at these two years two thousand and six and two thousand and seven and they said yeah but why you look at those two years why you look at all the years and then you take out the telescope and you look at two thousand and one two thousand to two and three and by the way two thousand and eight after two thousand and seven and guess what every other year the following rates lower and so do you ask why did you pick those two years to say the following rates higher in canada just those two years was there something special is there a new bankruptcy for medical cause it's very often the case that a debtor filing for medical reasons may file actually too early if they're not charging their their their medical bills on their visa card if they're simply dealing with the medical collection agency medical providers are not in the business of collecting debt and that practice is thirty two days old it goes to a collector and the collector is in the business of trying to collect what they can moving to judgment business actually encourage or discourage people paying off entirely because they want that they want to get the high interest rates on the recurring debt so medical debtors are very often forced into bankruptcy early there and while they still have chronic  conditions a large number of people who have excessive bills other people with chronic conditions i know my particular condition medicine breast cancer extremely expensive to deal with and though i have coverage insurance coverage seems to be covering it i certainly sit in rooms with people who do not file bankruptcy and then they have to wait depending on the kind of bankruptcy they filed or what chapter they filed under and other criteria they have to wait five years what if they have one of those medical providers who says i'm not going to i'm not going to give you continuing care until you pay off this previous bill they may be in a condition where they're simply not going to get care if they're not permitted to utilize the bankruptcy system i don't think you want them you know you don't want repeat filers we want to discourage i want to address the underlying problem but where you have this situation you may want people if they meet certain criteria at a particularly high  percentage of their debt that is medically related you may want them in order to encourage their continued health and also to encourage their continued productivity you may want to allow them to file more  counseling that might be unique to medical bankruptcies yes i think so and i know there are some legislation proposed i think it's h r nine zero one that says why don't we try to carve out a definition of medically bankrupt and see if we can reduce some of the more onerous bankruptcy law provisions for these medical bankruptcy it seems one area that would be for example the means test as one example other areas that the new bankruptcy because it's not new anymore that the current bankruptcy bill requires is compulsory pre bankruptcy credit counseling and then in bankruptcy financial education or financial rehabilitation courses and those are compulsory no one gets out of those and so one can question if you if you assume you're able to come up with a good definition medical bankruptcy and it's workable if you have  medicine cancer and i didn't have health insurance i don't know what use it is making them sit through it's like traffic school through like compulsory to well you know here's your education don't get breast cancer next time it just seems to me like a waste of time for everyone so there could be you basically said her study in your study come to different conclusions and essence doesn't believe that bankruptcy filings have probably been caused by medical debt that's a small matter she cites the major cause for concern for us here we could spend a lot of time dissecting these different studies train researchers in the medical school at harvard and then most of my day sitting in seminars and going through research technique and telling you why different research projects different conclusions what i can say is that this paper was peer reviewed at the american journal of medicine of the three thousand medical journals in the world number limit their number nine in terms of overall impact it was reviewed by other scientists has gone under very rigorous critiqu review the thing that really differs in our study from other studies is we asked the data what happened and we didn't just ask one question we asked them dozens even hundreds of questions to get a full picture of what happened and what we found is that many people said they were bankrupted because of medical dads others said i filed for bankruptcy to pay a mortgage on the mortgage to pay my medical debt other people said only way to get this kind of data is to ask people why they file for bankruptcy and ask them in enough detail to figure out what really happened and that's what we did and i actually asked people did you file you know what was the primary reason for filing and you can drink the different reasons and if you actually look at the data that survey shows that only nine percent of people claim that medical debts were respons the author of bach where he says that the question was actually did you take out any loan so many people will not think of a paying off a hospital bill overtime so if you can't pay your hospital bill card serve a consumer finance is not adequate to the task nor frankly is a p s i do which is a good study but they had a grand total of seventy bankruptcies in the entire study they identified half the right a bankruptcy that would be recognize i think as everyone in this room does that people encountering medical challenges and sudden disasters in their life affect them in every way including financially i mean i hesitate but i will tell you that i had eleven surgeries before i was nine years old some situations birth defect and it was a profound burden on my family and so i understand that those things are real and i know that there bankruptcy is nationalized health care the professor will handle or said that private insurance is fundamentally defective without those are her words not mine but she said that you know a single payer  system would save hundreds of millions of dollars again your own words not mine and i would just suggest two things first of all to save hundreds of millions of it'll be a first in history where government doing something of this complexity actually save money  and if indeed private insurance is fundamentally defective it leaves only the government option and here's my concern with all of the crises that people face with health health care if you put it in government's hands even to a partial extent you will do a couple of things you will diminish the dignity of the patient the pressure will be on giving less health care that will be the only outlet of the system because there's tremendous pressure in the system no matter what we do and i am convinced that health care will become more expensive in the ultimate result will be those people in crises like my family was will simply not be able to navigate the bureaucracy and instead of having financial bankruptcy we will have health bankruptcy and i'm very very concerned about that because you know the highway of history is littered with the wreckage of governments who thought that the socialistic perspective were tendency would somehow create more productivity and create products or services that would be better and cheaper the only thing is really proven in our history to do that is a private market that instigated responsible activity on the part of everyday people and i believe this country has tremendous capability i want to mention one other example here there was a time when government was a kind of quasar i because you know i know that my my friends on i should say my left but i can't let my friends  on the other side of the aisle believe that i'm mischaracterizing a nationalized government takeover of health care and i understand that but listen then for the sake of argument hope the sake of enlightenment look at what happened when government had quasar involvement in the telephone company there was a private model was a private company but government was all in the middle of it and controlled it and regulated it and again telephone service was enormously expensive and we had almost no and if we want to do that the health care that's exactly the wrong direction but what happened when we encourage the private sector to be really involved all of a sudden there was an explosion in technology that made telephone services and all kinds of the related services much cheaper and much better for everyone for everyone and my concern is that we're going again in exactly the wrong direction with the idea of moving in a government direction health care if we want to help those who are and this is important those who are under insured there can't be find insurance because they can't afford it why doesn't the the majority offer something where we would give them a draft to go out and buy the private health insurance of their own choice that is empowering those who don't have what they need that would change the entire dynamic and it would incense it private market system which would help everyone let me ask a question right quick before i'm out of time mr mr dr myth or recent harvard study that you've talked about today i want to give you a chance concluded that medical debt significantly contributed to sixty two percent of consumer bankruptcies i want to give you another chance do you believe the study accurately reflects the impact of medical debts on consumer bankruptcies in america and are you aware of other studies that represent this high and similar results what accounts in your judgment for the high correlation of medical debt and bankruptcy found in the harvard study by their own estimates is twenty nine percent whether the survey is random sample whether it would sort of i don't i think sampling thousand people you know and asking them  case i think the most what you can take from the study is that maybe twenty one percent of the respondents believe that medical bills had something to do with the bankruptcy filing whether it was the actual cause whether it was the you know the proximate  finance in other places that would suggest that that number is even close to being accurate i think it's an overstatement every study that i've come across actually finds a much higher credit god that you can distinguish between the two  that medical debts are the single most most important factor causing bankruptcies today thank you this review of well i think the question of whether national health insurance would actually save money is an empirical question that you can answer by looking at places that have tried national health insurance it's which is not socialized medicine it's socialized insurance like medicare for all but you can look and say where they have national health insurance as a cost more or less and the reality is the united states is paying twice as much as the average for other industrialized nations with the only industrialized nation that does not use nonprofit national health insurance so the scientific empirical answer about what's the most affordable if we accept international evidence is going to be that national health insurance is more affordable the reason for that is the tremendous administrative savings that you get with national health insurance so when you have one payer like a medicare for all type program not only do you get the administrative savings at the insurance center but it also means doctors and hospitals don't have to have their complex billing apparatus or complex staff of  clerks who argue with the insurance company doctors like me don't have to spend my time on documentation that's just there to argue about who gets paid and canada has administrative overhead in their system of of only about sixteen point seven percent in the u s it's about thirty one percent of total health spending and again that that's a peer reviewed study we've been talking about a lot about peer of you and new england journal of medicine two thousand and three so if we were able to reduce our administrator calls to canadian levels we'd save about four hundred billion dollars a year which is the money we need to cover all of the forty seven million uninsured with money left over to plug the gap professor like to respond quickly if i could first i'd like to briefly weighed in again on this on these methodological questions and i feel somehow dr will has been put in this almost defensive posture and i think that is that is wrong in fact if anything i think her study is one of the most rigorous math logically and again i cannot emphasize enough that when you talk to people who are filing for bankruptcy first and foremost on their mind is not the accurate classification of their debts for academic studies of people who are questioning them and so they do answer things like why did you go bankrupt because of the mortgage and it's only through that second level of in depth survey analysis to say what a mortgage on your house is like because the wife's surgery and so i don't see anything in congress about that that will hamper and i'll study having higher estimates so i think as you get through more gradations of understanding you're going to see those numbers go up i mean speak anecdotally as someone raised in the canadian system i mean i don't know how much it is important how it changes i've been on the states but like i certainly didn't feel any lack of dignity and i think was raised pretty healthily the one thing i was struck by coming to the american system was that you didn't have to get a referral everything i think they try to tell much more through the primary care medical system in canada so if you want to go see like an orthopedic surgeon you've got to wait your primary care doctor does a referral and that may be like an athame to the libertarian culture of free medical choice here or it might be a way of reducing costs to have some doctor but i don't have strong feelings of that whatsoever the final thing i want to say was i'm we do want to get to the point that i believe it was the that mr chairman who brought up about losing life's lottery from a bankruptcy perspective if you lose life's lottery and you're now bankrupt that's just like a terrible situation to be you're sort of like you've got two strikes at the same time and we're i'm not making a claim of causation i'm simply looking at bankruptcy as like doing like post mortem in the entrails of the people who are in the worst financial circumstances in this country and if you find yourself there because you've lost lost life's lottery that should be to the extent we can design legislation as minimally painful respite as possible you should go in and out quickly and if we can differentiate you from sort of charge card junkies then we should try to do that with bankruptcy legislation i'm sorry not speaking to render health care context that we're arguing about medical bankruptcies the problem with the stance of medical costs that people are suffering doesn't just reflect itself in medical bankruptcy it also reflects itself in a different area as well it reflects itself in the number of foreclosures we have christopher roberts has done a study published in health magazine indicates fifty percent of foreclosures have as one of the causes one of the one of the substantial causes medical costs both medical costs because they've lost their job they've had to quit their job in order to take care of somebody who needed long term care and that wasn't covered by any insurance and they knew that was a cheaper thing for them to do or whatever that all related to medical costs and the inability of that family to meet medical expenses you think of the larger economic problems we're having right now you know if the truth is we never had subprime mortgages maybe half the houses on street wouldn't be for sale for because of foreclosures because because of a subprime mortgages but half would still be being foreclosed because of mortgages that had to do with health care costs and that that could use to be an enormous problem when you think about the consequences of that the consequences of that are the collapse of the real estate market which means that our creditors our banks become under collateralized and that that's part of the problem because the report has the ripple effect is that the only reason it is not the only reason but to ignore the fact that medical costs are part of the underlying problem with the financial meltdown that we've experienced would be would be to completely turn a blind eye to a significant problem that we can s it's not just this is a problem out there that seems unsolvable we can solve this problem i believe that that congress and frankly probably being hyperbolic and didn't actually mean that but that the federal government should be making a contribution to pay for the forty seven million dollars but people who are uninsured and i suppose an additional for people who are under insured the twenty five million or under insured but we're talking about you know the enormous amounts of money talking about we're talking about six trillion dollars over ten years is what we're talking about in order to in order for the recess the reason we're not talking about it we're not talking about doing that is entirely too much money we have to solve the problem in a way not only that it deals with the the problem of medical expenses and that the moral and financial need for medical care because it has so many repercussions not just in the financial market but in businesses it creates two billion dollars uninsured loss of productivity two billion dollars a year i mean this is a standstill amount of money we can address all of those issues we have to do it in a way that makes economic sense the suggestion is simply you know for whatever the actual reason it was presented is simply not the kind of solution we need to be looking for thank you m when a family or parents in difficulty paying their medical bills that is it has been your experience that hospitals and physicians are willing to do what they can to work with that family to see if there's a way they can pay it off two thousand and one two thousand and seven we asked people to give like a narrative report of what happened like a longer story and i actually read all of the reports in the two thousand and one study and a fairly typical study would be like i mean this is a real person a school teacher who gets a heart attack can't teach school loses their health insurance gets a twenty thousand dollars hospital bill savvy consumer goes to the hospital in the goes and gets the hospital to write off the entire bill but bankrupted anyway because of the doctors bills and the bills for medications but on a credit card so there are savvy consumers go in and try to negotiate these things and occasionally they do get a deal but that doesn't stop people from bankruptcy because they can't get a deal that covers all of their bills they can't cover the hospital bills and the doctor's bills and the drug bills all at the same time having to go into that doctor's office and quite frankly maybe one of the reasons why you see the instance of credit card debt rising is a little bit more anonymous to put it on the credit card so that's another piece of economic data as for hospitals themselves i know that there is an emerging i think that's right i think what the worry is is that you go up your doctor's office and if you have a bigger bill last month and you kind of get this awkward talking to the nurse and you maybe you're not going to get the full level of trust i think the truth is if you if you have a problem with sears you can  get your washer dryer someplace else if you having a problem with your doctor you know you have a continue relationship and you need that continue relationship because health health care is port and one of the things that were sometimes is if you have an insurance policy you will get one kind of bill you might get a larger bill if you are uninsured and that larger part of the reason for the larger bill is that we have a lot of charities that try to help out people who don't have work things out or they but they can only pay twenty percent of the bill twenty percent that's a closer to the insurance number so that's why you often see an inflated number for the health care provider usually a hospital as opposed to a doctor and i played a number for that so that skews a little bit of what you're talking about it let me change gears i want to go to something that happened last week and just get your thoughts as we're talking and we've sort of talked about health care in general last week the president made a statement during his press conference that i found troubling and i'd like to get your thoughts and again we'll start with the physician in the in the witness panel but if you remember during that press event he made the statement that doctors will in some cases take the tonsils out of a child not because it's in the best care of that child that patient but because they will make more money and i found frankly that trust more a politician or a doctor and my guess is one hundred percent of them will say the doctor and yet the president of the united states in the midst of this health care debate made that kind of statement it's i'd like your thoughts on the president's comments last week to the american people start with the doctor well there's a tremendous amount of over treatment in the united states does a tremendous amount of overuse of expensive technology most of which is useless but some of which is actually harmful to patients driven by what are you saying your colleagues doctor are making decisions many of us would argue that if we would maybe look at some reforms in the system there may be less of what you just described do surgeries to make more money but for the vast majority of them it's not that they're scoundrels it's that the entire educational system the entire payment system is biasing us towards being overly invasive and overly intensive so that all the new medical students all the new residents are being trained to order a c t scan every time someone has a belly ache or call that tremendously expensive it's invasive it exposes patients to radiation they don't need they're not being bad people they're just working in a system that biases us what overtreatment and we in other countries some of the other countries that's been left to do it you know by having all these scans and tests or whatever but using