A Harvard study found that 62% of US bankruptcies in 2007 were caused by medical bills or health-related problems, such as lost wages due to illness. Most of those who went bankrupt were solidly middle class: two thirds owned a home, 60% had been to college, and 78% had health insurance when they fell ill, most of them through large private companies.
At the time of bankruptcy, the average medical bill was 17,749 dollars for people with health insurance and 26,971 dollars for people without. The most expensive illnesses were nerve diseases such as multiple sclerosis, followed by diabetes, injuries, strokes, mental illness and heart disease.
Health insurance doesn't mean you are safe from bankruptcy. Most plans come with extra charges that can add up to large sums. And insurance through your job is lost if illness stops you working and you lose the job: a quarter of companies cancel the insurance at once, while the rest keep it for up to a year.
Because of widespread anger at these private insurance practices, President Obama has proposed a public (government) insurance plan as part of his health reform. Republicans oppose it, but supporters argue it would bring more competition and keep insurers honest, although many doubt insurers would survive such a step.
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