One in Four Seniors Lack $500 for Medical Bills: Survey

Data Journalist

Updated on December 2nd, 2021

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Key Findings

27% of Americans aged 65+ have less than $500 in savings to pay for medical bills.

24% of elderly Americans carry medical debt.

37% of seniors find it very difficult or difficult paying for healthcare between 60-65.

28% of respondents say they would use retirement or non-retirement savings to pay for a severe illness.

Less than 2% say they have a tax-advantaged Health Savings Account.

More than one in four elderly Americans (27%) have less than $500 in savings to spend on medical bills.

On the other hand, one in three (33%) have more than $6,000, with the bulk of the remainder falling somewhere in between.

The diverging fortunes of senior Americans emerge in a new survey of U.S. adults aged 65 and up.

Deferring Treatment

Facing a lack of savings, some older Americans on original Medicare are postponing medical treatments. 

Asked if they have deferred treatment for dental, hearing, or vision issues, over one in four (26%) said they have. 

65% of older Americans have tried to save on prescription drugs by, for example, seeking out generic versions of medications (24%) or asking for larger supplies (18%).

Close to a third (29%) also put off expenses including home repair (6%) and travel (6%) in order to afford healthcare.

Hit by Out of Pocket Costs

Despite deferring treatments, 36% of Americans over 65 still spent more than $1,000 on out of pocket healthcare services in the last year.

Among this group, the largest number, 17%, cited out of pocket medical charges for a range of services including dental treatments. 

That was followed by hearing services (10%) and prescription drugs (9%).

Surprise medical bills also confounded many older Americans. 

Almost one in three seniors (31%) say they received surprise medical bills in the last year.

For 18%, the amount was over $500.

Asked to rank their healthcare expenses, 24% of elderly Americans say their largest cost is long-term care, followed by health insurance (21%), and dentist bills (19%).

Precarious Finances

With many seniors confronting a lack of savings for medical bills, two-thirds of elderly Americans (67%) told they are somewhat or very concerned about paying for healthcare costs.

46% of 65+ Americans are also very or somewhat concerned that a major health situation in their household could lead to medical debt or bankruptcy.

To pay for a severe illness, 28% of respondents say they would dip into retirement or non-retirement savings. 

Less than 2% say they have a tax-advantaged Health Savings Account.

We also found that many older Americans qualify for Medicare at age 65 with preexisting health finance worries.

MedicareGuide asked respondents how easy or difficult they found paying for healthcare between the ages 60-65.

Over one in three elderly Americans (37%) answered they found it very difficult or somewhat difficult.

“As we enter the fall Annual Enrollment Period it’s a good time for folks to take a close look at their finances,” says Jeff Smedsrud, a cofounder of MedicareGuide parent company

“During AEP people can sign up for Part D prescription drug coverage, change Medicare Advantage plans, and switch between Original Medicare and Medicare Advantage. Cash-strapped seniors may be eligible for plans that offer better savings and coverage than their current plan.”

Methodology: conducted this survey utilizing a SurveyMonkey Audience on September 13-16, 2021, among a national sample of 1,176 U.S. adults aged 65+. The modeled error estimate for this survey is plus or minus 2.0 percentage points. The sample was balanced for age, gender, and U.S. Region according to the Census Bureau’s American Community Survey.

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