Wednesday, August 12, 2009

Data on Health Care Costs and Home Foreclosures

Here's an article by Christopher Robertson, at Harvard Law School, on the Medical Causes of Home Mortgage Foreclosures that I found on the Social Science Research Network.

For me, this speaks to our need to focus on health care coverage for all as a way to impact the economy in a positive way. I've underlined and boldfaced the abstract below where information stands out to me. I encourage people to read the entire thing.

Thoughts? Questions?

Get Sick, Get Out: The Medical Causes of Home Mortgage Foreclosures Christopher T. Robertson Harvard University - Harvard Law School

Richard Egelhof affiliation not provided to SSRN

Michael Hoke
affiliation not provided to SSRN

Health Matrix: Journal of Law-Medicine, Vol. 18, No. 65, 2008

In recent years, there has been national alarm about the rising rate of home foreclosures, which now strike one in every 92 households in America and which contribute to even broader macroeconomic effects. The "standard account" of home foreclosure attributes this spike to loose lending practices, irresponsible borrowers, a flat real estate market, and rising interest rates. Based on our study of homeowners going through foreclosures in four states, we find that the standard account fails to represent the facts and thus makes a poor guide for policy. In contrast, we find that half of all foreclosures have medical causes, and we estimate that medical crises put 1.5 million Americans in jeopardy of losing their homes last year.

Half of all respondents (49%) indicated that their foreclosure was caused in part by a medical problem, including illness or injuries (32%), unmanageable medical bills (23%), lost work due to a medical problem (27%), or caring for sick family members (14%). We also examined objective indicia of medical disruptions in the previous two years, including those respondents paying more than $2,000 of medical bills out of pocket (37%), those losing two or more weeks of work because of injury or illness (30%), those currently disabled and unable to work (8%), and those who used their home equity to pay medical bills (13%). Altogether, seven in ten respondents (69%) reported at least one of these factors.

If these findings can be replicated in more comprehensive studies, they will suggest critical policy reforms. We lay out one approach, focusing on an insurance-model, which would help homeowners bridge temporary gaps caused by medical crises. We also present a legal proposal for staying foreclosure proceedings during verifiable medical crises, as a way to protect homeowners and to minimize the negative externalities of foreclosure.

Robertson, Christopher T., Egelhof, Richard and Hoke, Michael,Get Sick, Get Out: The Medical Causes of Home Mortgage Foreclosures(August 18, 2008). Health Matrix: Journal of Law-Medicine, Vol. 18, No. 65, 2008. Available at SSRN:

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