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In the U.S., where healthcare is expensive, the uninsured and poor face a daunting risk. The lack of coverage isn’t just a result of poverty but a complex web of socio-economic factors. These individuals, often just above the poverty line, face a difficult decision: forgo insurance due to its high cost. This decision leaves them vulnerable, teetering on the edge of financial ruin with every health scare. Their plight is a stark reminder of the urgent need for healthcare reform.
Despite the gradual fading of the pandemic over the past three years, the United States still holds the grim title of the country with the highest number of COVID-19-related deaths worldwide. The total death toll currently stands at approximately 1.15 million. When considering the number of cases per million people, the figure isn’t as high as expected. However, this is due to many individuals not getting tested. But what deterred so many people from seeking medical attention during the initial stages of the pandemic?
The story begins in January 2020 when a company sent an American employee on a business trip to China. Upon his return to the United States, he noticed a slight fever. Although there was no pandemic in the U.S. at the time, he remembered the recent outbreak of pneumonia in China. Out of responsibility and morality, he went to the hospital for a check-up. He only had the flu but received a hospital bill for thousands of dollars.
This news quickly spread across the internet, enlightening most Americans about one thing: even if you have symptoms, try to self-medicate first and avoid getting tested because you can’t afford the testing fee. Two to three weeks after this message spread, the panic of COVID-19 gradually infiltrated the U.S. The government began to realize that high testing fees could deter people from getting tested, potentially aiding the spread of the disease. As a result, they urgently ordered free testing and initiated drive-through testing at hospitals and supermarkets nationwide. It led to a sharp increase in confirmed cases.
But did the free testing increase people’s willingness to get tested? Unfortunately, it didn’t. What if the test came back positive? Of course, treatment would be necessary. While it seems reasonable to treat an illness, it’s more complex in the U.S. due to high medical costs. In other words, while testing was free, treatment was not.
In the United States, the health insurance system is a complex issue. According to 2022 statistics, approximately 27.6 million people are uninsured, or 8.4%. This figure does not include undocumented immigrants; the number would be higher if they were included.
The lack of insurance among these individuals is not solely due to poverty. The U.S. government provides Medicaid for low-income groups and Medicare for those aged 65 and older.
Unfortunately, these uninsured individuals’ income is slightly above the federal poverty level(FPL), making them ineligible for full assistance or only qualifying for partial aid. Considering the high monthly health insurance premiums, they often choose not to purchase insurance.
In case of illness, they can opt to pay in cash. Hospitals may even offer discounts for cash payments, especially for those without insurance. In the event of a severe illness or injury, they are taken to the emergency room, where treatment is provided first, and payment issues are dealt with later.
This uninsured group typically comprises young people or those living paycheck to paycheck. Imagine what would happen if these individuals contracted COVID-19.
Based on experience, not everyone who contracts pneumonia (a common complication of COVID-19) dies. However, if they are diagnosed and required to undergo mandatory treatment, the actual “death sentence” comes when they receive the medical bill. The high cost of medical care can be impossible for those without insurance.
According to a report by KFF Health News, over 100 million Americans, which includes 41% of adults, are in debt due to issues with the healthcare system. While the majority expect to repay their debts, 23% anticipate it taking at least three years, and 18% believe they will never be able to pay them off.
Between 2020 and 2021, Americans’ primary cause of bankruptcy was not laziness or unemployment but rather the significant rise in medical bills.
Alarmingly, not those with a fixed income who are most affected by this issue, but individuals with low-income jobs.
The financial risks the impoverished face differ significantly from those of the middle class. Many believe that people with low incomes are less affected by financial crises or stock market crashes because they have little to no savings. In contrast, the middle class often bears the brunt of these economic downturns. However, people with low incomes live in a constant state of financial crisis, facing high levels of risk daily, though with less volatility.
The book “Poor Economics: A Radical Rethinking of the Way to Fight Global Poverty” mentions that an Indonesian family ran a small knitting workshop at home. They were slowly accumulating profits with the hope of escaping poverty. A friend offered to buy a large order, giving them a check for 20 million Indonesian Rupiah. When the family went to cash the bill, they discovered it was worthless. While 20 million Rupiah may not seem like a large sum, equivalent to a few thousand U.S. dollars, this loss was enough to plunge them back into extreme poverty.
They sought help from the police but were left bankrupt when the police failed to recover their money.
This real-life example illustrates that the risk of falling into extreme poverty is much higher for people with low incomes than the risk of the middle class descending into poverty. A minor financial setback, just a few thousand dollars, can be enough to derail a family on the brink of escaping poverty.
Why do people with low incomes face challenges in managing risks? The middle class usually has some emergency funds, but people experiencing poverty lack these savings, making them more vulnerable to financial crises and unexpected life events.
We’ve noticed that specific side effects have begun to reappear following the economic downturn in 2022 and 2023. For instance, significant changes have occurred in the U.S. West Coast commercial areas. It is partly due to the increase in remote workers post-pandemic and layoffs in the tech industry towards the end of last year, leading to a rise in vacant office spaces. On the other hand, a law passed in California in 2014 treats single thefts of under $950 as misdemeanors, leading to a recent surge in theft cases in CBD areas.
These are the impacts we’ve observed post-pandemic. From the U.S. examples, these risks are inevitable products of our social structure. However, we can understand how they’ve gradually led to the current situation and interpret them from the perspective of the economic market. Despite the significant erosion of purchasing power due to inflation, being middle-class is still considered fortunate. But we should also contemplate our relationship with society and deeply think.