Covid debt catastrophe looms in the US

About 12.5 million Americans are at risk of bankruptcy after receiving exorbitant bills for medical services provided to them during a pandemic, according to a survey conducted by LendingTree in March this year

Covid debt catastrophe looms in the US

 

According to Newsweek, many of those unlucky enough to have contracted the coronavirus in the US are grateful for the doctors who saved them from the deadly disease, but sadly ironic that dying would have been cheaper. According to experts, America is steadily heading towards a post-pandemic debt crisis and a wave of bankruptcies that will primarily affect the most financially vulnerable

“The extent of the coming medical debt crisis is not yet clear”, –  says Brian Martucci, financial editor of MoneyCrashers.com, a personal finance website, – “But with tens of millions of Americans without health insurance and hundreds of thousands hospitalized with COVID since the pandemic began, it is safe to say that many individuals and families will face or are already facing life-changing financial trauma.”

For example, a nationally representative survey found that 60 per cent of respondents had medical debts, with about 10 per cent of these being related to the virus; the amount of debt typically ranged from $5,000 to $9,999. This suggests that the total COVID medical debt to date could be in the region of $60 billion to $125 billion. And this number is bound to rise sharply in the coming months.

Although various public and private programmes were put in place by the federal government at the beginning of the pandemic to protect people with coronavirus from the high costs of treatment, the result is that most of these were not implemented and the few that were working, for better or worse, have long since expired.

But the biggest revelation for American taxpayers has been the total unpreparedness of the US healthcare system to cope with such a massive epidemic. Every day there were new reports here and there about errors in billing for treatment, misuse of federal money, the lack of an adequate system for informing patients about the care available to them, and more.

But that’s not all; in addition to the astronomical medical bills, American citizens have faced a succession of layoffs, and as a result, the unemployment rate in the US has now reached a record 14.7%. Thus, the vaunted American economic liberalism has been rendered powerless in the face of the real threat, and has shown itself totally incapable of solving truly enormous problems under extreme conditions.

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