An operation shatters pension plans and leads to bankruptcy

They took everything we had.

Sherry Foy

Sherry Foy63, Coin, Virginia

Estimated medical debt: $ 850,000

Medical problem: Colon surgery

What happened: Sherry and Michael Foy thought they had made all the right preparations when they moved to rural Southwest Virginia after Michael retired from Consolidated Edison, New York’s largest company.

Sherry Foy loved horses and had begun rescuing unwanted animals. The couple diligently saved. And they had pension health insurance through Con Edison.

“We’ve never been rich,” Sherry said. “But we had what we wanted.”

Then in 2016, Sherry, who lived for years with constant intestinal irritation, had her colon removed. After the operation, she contracted a dangerous infection and barely survived.

Complications led to nearly $ 800,000 in University of Virginia Health System bills for services not covered by Foy’s health insurance.

When the couple can’t pay, the state sues Sherry. The only way to overcome it, Foy concluded, was to declare bankruptcy.

The egg nest, which had been carefully built so that her husband could retire earlier, was destroyed. They redeemed a life insurance policy to pay a lawyer and liquidated savings accounts they had created for their grandchildren.

“They took everything we had,” Foy said. “We have nothing now.”

What is broken: Foy fell victim to a flaw in her husband’s health insurance pension plan, which limited lifetime coverage to $ 1 million.

Such caps were more common before the Affordable Care Act 2010, although some plans with these caps have been made.

Relatively few patients with medical obligations have been prosecuted, and some medical centers have been forced to reduce practice in recent years following news reports of lawsuits. (The University of Virginia Health System has changed its policies since then KHN investigation from 2019.)

But hospitals and other health care providers still rely on the courts to collect from patients.

More broadly, bankruptcy caused directly or in part by medical debt remains a significant problem.

or KFF national survey conducted for this project found that about 1 in 8 adults with health debt were forced to declare bankruptcy.

What’s left: Sherry said her health had improved.

After complications from the operation in Virginia, she returned to New York to seek help at a hospital that said she saved her life. That hospital never paid her bill, she said. She does not know why, but believes she may have qualified for charitable care.

The bankruptcy was devastating. The Foy family handles Michael’s pension and their Social Security checks.

That same year, when they declared bankruptcy, Michael also suffered a heart attack and their daughter was diagnosed with breast cancer.

“It’s been a disaster for a year,” Sherry said. “No one has to go through this.”

Sherry has no health insurance. She hopes there will be no more big medical bills before she turns 65 and qualifies for Medicare.

About this project

Diagnosis: Debt is a reporting partnership between KHN and NPR that examines the scale, impact, and causes of medical debt in America.

The series is based on “KFF Health Debt Study, “A study developed and analyzed by KFF public opinion researchers in collaboration with KHN journalists and editors. The poll was conducted in February. March 25-20, 2022, online and by telephone, in English and Spanish, among a nationally representative sample of 2,375 adults in the United States, including 1,292 adults with current health debt and 382 adults who have had health debt in the past five years. The margin of error of the sample is plus or minus 3 percentage points for the full sample and 3 percentage points for those with current debt. For results based on subgroups, the sampling error limit may be higher.

Additional research was conducted by the Urban Institutewhich analyzes the credit bureau and other demographic data on poverty, race, and health to examine where medical debt is concentrated in the United States and what factors are associated with high debt levels.

JPMorgan Chase Institute analyzed records from a sample of Chase credit card holders to look at how customer balances can be affected by high medical costs.

KHN and NPR reporters also conducted hundreds of interviews with patients across the country; talk to doctors, health industry leaders, consumer advocates, debt lawyers and researchers; and reviewed numerous studies and studies on medical debt.

KHN (Kaiser Health News) is a national newsroom that produces in-depth journalism on health issues. Along with policy analysis and surveys, KHN is one of the three main operational programs in KFF (Kaiser Family Foundation). KFF is a gifted non-profit organization that provides information on the nation’s health issues.

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