Many Californians with medical debt are insured HEALTH CARE

More than two-thirds of the 2.2 million Californians who reported being in debt due to medical expenses actually had health insurance when they incurred their debt, according to a study released today by the UCLA Center for Health Policy Research.

Statewide, the study found nearly 1 in 7 - or 13 percent - of non-elderly Californians had medical debt. The report, based on data collected in 2007 from about 53,000 households, showed that 19.5 percent of Californians were uninsured for all or part of that year.

The greater Bay Area had among the lowest percentage of both medical debt and people without health insurance.

Just 11 percent of Bay Area residents reported being in debt from medical bills, slightly higher than 10.9 percent in the Sacramento region, but significantly lower than in the northern and Sierra counties, where 24.7 percent of those surveyed said they had incurred medical debt.

Napa County had the Bay Area's highest rate of medical debt at 20.3 percent, compared to 10.4 percent in San Francisco.

As for coverage, about 13.1 percent of Bay Area residents said they were uninsured for all or part of 2007 compared to the San Joaquin Valley rate of 22.7 percent and nearly 23 percent in Los Angeles County.

Researchers released a similar study two years ago, but this time asked about medical debt. They expressed surprise by the high number of respondents who reported going into medical debt while insured.

"What it really speaks to is that insurance is not able to cover financial risks in the way most people would expect and would want it to," said Shana Alex Lavarreda, director of health insurance studies for the UCLA center and a co-author of the report.

People who are insured often find themselves in debt because their insurance has limited benefits and high out-of-pocket costs, Lavarreda said. She said a growing number of people are buying policies with high deductibles or those that require them to pay a percentage of the total bill.

"When you get a high deductible plan, you have less coverage and you're exposed to more risk," she said, adding that some people buy policies with deductibles of several thousand dollars in order to afford the monthly premiums.

The consequences of medical debt include delayed care. According to the survey, 32.3 percent of those with medical debt reported delaying needed care compared to 16.1 percent of those who were debt free.

San Jose resident Yvonne Fadlin, 63, has been saddled with more than $8,000 in medical debt after her health insurance policy refused to cover all but about $2,000 of a hospital bill she incurred last year while being treated for diverticulitis, a disease that affects the colon.

Fadlin, who was paying $286 a month in premiums, dropped the policy in December and, as of last week, has run out of the medication she takes to control her diabetes.

"I'm stressed, and it's stressing my husband," said Fadlin, adding her husband is unemployed and she has been struggling to work more hours as a licensed vocational nurse. "Everything is affected - my bills, my health."