Free-market think tank, the Fraser Institute, says massive medical expense-driven personal bankruptcy is a myth. They also say introduction of government-run health insurance in the U.S. will not reduce the number of personal bankruptcies.
The free-market think tank has offices in Canada and the United States, so it has expertise in both North American markets.
In the debate about reforming U.S. health care policy, proponents say almost two-thirds of personal bankruptcies in the U.S. result from uninsured medical expenses or loss of income due to illness. Those who advocate socialized medicine as a cure-all, say such bankruptcies would not occur if the U.S. had a government-run health system similar to Canada’s.
The Fraser Institute’s director of bio-pharma, health and insurance policy research, Brett Skinner, says the evidence does not support the bankruptcy claims.
Skinner is the author of Health Insurance and Bankruptcy Rates in Canada and the United States.
“If socialized medicine played a role in reducing personal bankruptcies, we would expect to see a lower rate of personal bankruptcy in Canada compared to the United States. Yet the reverse is true. The personal bankruptcy rate is actually higher in Canada than it is in the U.S.” Brett Skinner, Fraser Institute
Comparing U.S. and Canada bankruptcy data from 2006-7, Brett Skinner showed that U.S. personal bankruptcy filings as a percentage of population were 0.2 percent in 2006 and 0.27 percent in 2007. Canada was slightly higher for bother years, at 0.3 percent. See the complete study at www.fraseramerica.org.
“There is no evidence to support the idea that a government-run health care system in the U.S. will reduce personal bankruptcies,” Skinner said.
Skinner says that insufficient income, most often the result of unemployment, is the main cause of bankruptcy and lack of health insurance coverage. He says “The majority of debt among bankrupt consumers in both America and Canada is composed of non-medical expenditures and therefore, has little to do with health insurance coverage.”