One in four Americans are saddled with medical debt and there are currently proposals in the state legislature to address it in Connecticut.
Tackling medical debt: that is the goal of a startup called Goodroot in Collinsville.
Americans have $88 billion in medical debt, according to a February 2022 report from The Consumer Financial Protection Bureau. It impacts nearly one in four people, Lendingtree reports.
Now, Goodroot is pushing for measures they say would put the patient first.
“We sometimes refer to it as medical oppression, because it's not really the same as other debt. A lot of times, you're not making the choice,” Michael Waterbury, Goodroot CEO and chairman, said.
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Medical debt is the leading cause of bankruptcy in the United States, and 23% of Americans are saddled with debt from medical bills, according to a Lendingtree survey. Even those with insurance can accrue debt.
“Some care is very expensive, and a lot of the hospitals are doing an amazing job,” Waterbury said. “It's just how do we pay for it so that the patient isn't left in financial ruin?”
That’s the question that Goodroot is setting out to answer. The startup is looking to address the situation in states across the country and in Connecticut.
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“In Connecticut, we have a lot of people who have insurance, we have a lot of people who have access to Medicaid, we really don't have a high percentage of uninsured,” Waterbury said. “So it's interesting, because we still have a lot of debt.”
That is why Waterbury supports efforts in the state legislature to bring that debt down.
One is in Governor Ned Lamont’s budget proposal, which aims to allocate $20 million in COVID-19 relief funds to eliminate $2 billion of medical debt for Connecticut residents. It is pending in the state legislature, and subject to ongoing negotiations.
“We're very excited about that. We would love to be involved. We know our companies can help,” Waterbury said. “The key for us in that initiative is not just to help the people with debt, it's ultimately to find out what's causing it and fix those issues.”
Other bills also making their way the legislature include Senate Bill 983, an act limiting anticompetitive healthcare practices; House Bill 6669 that would establish a drug discount program; and House Bill 6740 that would automate financial systems to help people get assistance.
Waterbury is watching HB 6669 closely.
“There's already a law, it should work better, and this new legislation is really going to require hospitals to do that. So we want more people to know, we want them to get enrolled,” he said.
Waterbury also hopes to see a Healthcare Steering Committee in the future, that would bring together stakeholders to discuss the best ways to address medical debt.
Healthcare costs rose 6% in Connecticut between 2020 and 2021, according to Goodroot.
“Our main focus is putting the patient back in the center of every decision,” Waterbury said.
By pushing for dialogue between hospitals and pharmacies, drug pricing transparency and financial assistance, Goodroot aims to find solutions to help patients better navigate the system.
“It's not a big bang, you can't replace it all at once,” Waterbury said. “We believe that you have to address one system at a time and then eventually you can have a major impact.”
Some Republican lawmakers are not on board with these proposals.
"While I appreciate this attempt at a solution to make Connecticut more affordable, this really is a band-aid approach," Senate Republican Leader Kevin Kelly (R-Stratford), told NBC Connecticut in a statement.
"It will only help a small number of people instead of lowering health insurance premiums and health care costs for everyone in our state. That's the approach we need to take, and that's what Republicans have been pushing for in our Better Way to Affordable Healthcare plan. Our solutions can reduce premiums by 30%. That’s an annual saving to the average family of four of $7,000, or almost $600 a month. That’s real money for real people.”
As part of that plan, Senate Republicans have proposed policies that will reduce health insurance premiums by up to 30%, and make quality health insurance more accessible to small businesses and employees.
The plan also calls to reduce the cost of prescription drugs, and increase transparency and data sharing to drive down costs.
