A quick quiz.
The following are medical bankruptcies in each country annually. Which country has 530,000?
🇦🇺 0
🇨🇦 0
🇩🇰 0
🇫🇮 0
🇫🇷 0
🇩🇪 0
🇮🇸 0
🇮🇪 0
🇮🇹 0
🇯🇵 0
🇳🇱 0
🇳🇴 0
🇵🇹 0
🇪🇸 0
🇸🇪 0
🇬🇧 0
? 530,000
In most wealthy nations, falling ill is a health crisis, not a financial one. In the United States, however, sickness routinely triggers economic catastrophe. Each year, hundreds of thousands of American households are forced into bankruptcy because of medical bills or illness-related loss of income, exposing the brutal realities of a healthcare system built on profit rather than protection.
Half a Million Families a Year
The most widely cited and rigorous research on the issue comes from a 2019 study published in the American Journal of Public Health. It found that around 530,000 US households file for bankruptcy every year where medical bills, illness, or loss of work due to health problems play a significant role.
Crucially, this figure does not merely reflect people overwhelmed by hospital invoices. It includes families who lost wages because illness prevented them from working, a common outcome in a country with weak employment protections and limited paid sick leave.
The study concluded that approximately two-thirds (66.5%) of all personal bankruptcies in the United States are linked to medical causes. No other developed nation comes close to this level of health-related financial collapse.
Millions of Lives Affected
Bankruptcy statistics measure cases, not people. Each filing usually involves a household, meaning the true number of individuals affected is far higher. When spouses and children are included, estimates suggest between 1.5 and 2 million Americans are impacted by medical bankruptcy every year.
These are not marginal cases. Many families forced into insolvency were previously financially stable. Medical bankruptcy often follows sudden events: cancer diagnoses, heart attacks, serious accidents, or chronic illness. For countless households, one diagnosis is all it takes to unravel a lifetime of work.
Insurance Is No Guarantee of Protection
Perhaps the most disturbing finding from multiple studies is that most people who experience medical bankruptcy had health insurance at the time they fell ill. High deductibles, co-payments, out-of-network charges and uncovered treatments mean that insurance frequently fails to prevent crushing debt.
In effect, millions of Americans are “insured” yet still financially exposed. Even routine care can generate bills running into tens of thousands of dollars, while serious illness can wipe out savings, homes and retirement funds with alarming speed.
Illness and the Loss of Income
Medical bills are only part of the picture. In the US, illness commonly leads to job loss or reduced hours, stripping families of income precisely when expenses are rising. Limited sick pay, weak disability support and employment-linked health insurance create a perfect storm in which getting sick can mean losing both healthcare and wages simultaneously.
For many, bankruptcy is not the result of extravagance or mismanagement, but of the simple act of becoming unwell.
An Outlier Among Wealthy Nations
The United States is virtually alone among high-income countries in allowing medical care to trigger mass bankruptcy. In countries with universal healthcare systems — including the UK — illness does not routinely result in personal insolvency.
Medical bankruptcy in the US is therefore not an accident, but a policy choice. It reflects decades of political decisions prioritising private profit, insurance markets and corporate healthcare over universal access and financial security.
A Quiet National Scandal
Despite its scale, medical bankruptcy rarely dominates headlines. Yet each year, half a million American families are financially destroyed by sickness, and millions more live one diagnosis away from ruin.
It is one of the starkest illustrations of inequality in the modern United States: a country capable of extraordinary medical innovation, yet willing to let illness bankrupt its citizens.
In the world’s richest economy, falling ill should not mean losing everything. In America, it still does.
Guess Which Political Party Wants the UK to Adopt Medical Insurance?
Reform UK.
