83% of Americans With Medical Debt Say Debts Are Enough of a Burden to Prevent Them from Making Major Purchases, According to the Cambridge Consumer Credit Index

83% of Americans say that debts they have incurred because of medical or dental procedures are burdensome enough to prevent them from buying large ticket items, according to the Cambridge Consumer Credit Index. 27% considered their medical debt a major burden, down from 29% who thought so in 2004. 56% now consider their medical debts a minor burden, up from 54% a year ago. 17% of the respondents said their medical debts did not impose any burden, unchanged from 2004. 19% of Americans have accumulated debt associated with medical or dental procedures, up from 16% in 2004. Of the respondents who have outstanding medical debts, 78% have healthcare or Medicare coverage (up from 76% a year ago), 53% have dental insurance (up from 49%), while 17% have no medical or dental insurance coverage (unchanged from a year ago).

Islandia, NY (PRWEB) February 7, 2005

“The results of the Cambridge Consumer Index wildcard question show that medical debt is a growing problem for many Americans. More Americans have accumulated medical debts in the past year. The burden of this debt remains enormous, preventing 83% of those with such debts from making other major purchases they would otherwise be able to make. The only positive news from the survey is that the percentage of Americans covered by health and dental insurance rose slightly from a year ago,” says Jordan Goodman, spokesperson/financial analyst for the Cambridge Consumer Credit Index.

The overall Cambridge Consumer Credit Index fell by seven points in February to 58. The Index rose on the “next month” question, and fell in its “last month” and “next six months” questions. The “Reality Gap,” which is the difference between the amount of debt consumers say they will pay off in the next month versus the amount of debt they actually paid off a month later, fell by 3 points from January to 17 points. A month ago, 84% of Americans planned to pay off debt, while a month later only 67% actually did so.

"An unforeseen medical emergency can thrust consumers quickly into severe levels of personal debt. Cambridge Credit Counseling Corp.’s monthly client survey indicates that large and unmanageable medical expenses are consistently forcing consumers to seek credit counseling assistance for themselves and their families. It is important to recognize that planning for a health emergency is a necessary part of your overall budget." says Chris Viale, Acting President & C.E.O. of Cambridge Credit Counseling Corp.

In conjunction with the Index, the Cambridge Credit Counseling Corp. is releasing its monthly survey of people who have called in for credit counseling services over the past month. Cambridge representatives ask callers for the primary reason that they found it necessary to get help with their debts now. Of the 307 people who answered, this was the order of their responses:

1. My income has been reduced from a lower salary, less overtime or layoff (35.2%)

2. I am frustrated with high bank rates and fees (25.4%)

3. I want to improve my ability to achieve future financial goals like buying a house or saving for retirement (14.3%)

4. I got into too much debt by overspending (7.2%)

5. Other (8.1%)

6. Recently divorced or widowed (4.3%)

7. Large medical expenses forced me to take on huge debts (2.9%)

8. My lack of financial education caused me to take on too much debt (2.6%)

These findings are the result of monthly nationwide telephone poll of 800+ adults conducted by ICR/International Communications Research in the past week, sponsored by the Debt Relief Clearinghouse. The Cambridge Consumer Credit Index is a forward looking economic indicator gauging consumer spending and debt. It is released on the fifth business day of every month to coincide with the Federal Reserve Board's G19 release of consumer credit outstanding data.

For more information on the survey see http://www.cambridgeconsumerindex.com/index.asp?content=client_survey
Contact Paramjit Mahli at mailto:pmahli@cambridgeconsumerindex.com or 631-786-6450 http://www.cambridgeconsumerindex.com/.

###


Contact