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The largest bills are mostly owed to hospitals

The Urban Institute study found that 73% of adults with medical debt owe hospitals at least some of it. Additionally, most of patients' largest bills were owed to hospitals: About a quarter, 26%, had a tab of $5,000 or more, compared with 6% among those who owed only non-hospital providers (i.e., a doctor or dentist). "There are probably a number of explanations for the difference," said Michael Karpman, author of the study. "When people go to the hospital, they tend to face more higher-cost procedures, they may have greater health challenges, and there's a lot of unpredictability about the charges and out-of-pocket costs that they'll be facing, " said Karpman, a principal research associate in the institute's Health Policy Center.

Even among insured individuals, owing is not uncommon. Almost two-thirds, or 63%, of adults with past-due medical debt incurred it when they had insurance, the research found. Another 21% incurred it when the patients had no coverage and 16% had the debt occur during a time period in which they initially had coverage but then lost it or vice versa.

An estimated 100 million adults have medical debt

Overall, an estimated 41% of people — or about 100 million adults — face medical debt, ranging from under $500 to $10,000 or more, according to a report from the Kaiser Family Foundation. The reasons for such debt going unpaid vary from person to person. The two main causes, said Haynes, is having a chronic health condition or being uninsured — or, often, both.

Deductibles may be unaffordable for some patients

Additionally, many health-care plans have deductibles that are high enough to pose affordability challenges for some patients. Deductibles are the amount you pay out of pocket before your insurance plan begins covering your care (although you may still be required to pay a copay or coinsurance).

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No Surprises Act is reducing unexpected bills

One of the biggest causes of unexpected large medical bills historically was out-of-network providers being involved in your care — often at a hospital — without you realizing it. Then the bill would come and you'd discover that your insurance didn't fully cover those charges, if at all. However, there are signs that the No Surprises Act has reduced many instances of unexpected, outsized bills. That legislation, which took effect in 2022, generally stops you from being billed at the out-of-network rate (although consumers should still be on the lookout for such charges due to billing mistakes).

Check whether you qualify for free or reduced care

If you are hit with a large medical bill from a hospital, be aware that many have financial assistance programs. While not all for-profit hospitals offer one, nonprofit facilities are required to have them, Haynes said. Check the back of your bill to see if there's information on a financial assistance program, she said. Or you can usually find it in the billing section of a hospital's website. Often, hospitals use 250% of the federal poverty level as the cutoff when determining a patient's eligibility for free care or a reduced cost, the Urban Institute research notes. The federal poverty level depends on the number of people in a household and is adjusted annually. In 2023, for a family of four, that amount is $30,000. So 250% of that is $75,000.

Some medical debt is dropping off credit reports