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medical debt
Under Healthcare 'Dystopia' Envisioned by Trump, Cash-Strapped Patients Would Take Out Loans From Insurers
"This could ruin people's finances, while creating a financial incentive for insurers to deny coverage," said one Democratic congresswoman.
Jun 12, 2026
After the Republican Party's decision to terminate subsidies that had significantly reduced healthcare costs under the Affordable Care Act for 22 million people, the White House is considering a new way to—officials claim—"help" Americans who face massive medical bills, either due to high-deductible plans that don't cover routine costs or because of emergency expenses.
The proposal, though, could just shift "who [the patients] owe the debt to," as one doctor and researcher told The New York Times, which reported Thursday on the Trump administration's proposal to allow people to take out loans directly from their health insurance companies when they can't afford to pay a hospital or doctor's office out of pocket—and then pay the insurance company back, likely with interest.
"Hard to top this level of dystopia," said one writer in response to the Times report. "Have health insurance through the ACA? The Trump administration is going to turn your health insurer into a loan shark you borrow money from if you can't afford to pay your portion of medical procedures."
As the newspaper was reported, the provision is buried in a 1,121-page final rule issued last month regarding how the ACA will be regulated next year.
The Trump administration is planning to significantly expand the number of Americans who are eligible for high-deductible "catastrophic" health insurance plans that provide no coverage for day-to-day medical expenses.
"We note that multiyear and 1-year catastrophic plans may be able to offer relief from the high deductible and maximum annual limitation on cost sharing through other mechanisms," reads the final rule. "For example, issuers of catastrophic plans could consider financing the deductible by providing enrollees a loan."
Currently, the average annual deductible for people insured under the ACA is nearly $4,000, and about 40% of enrollees this year have "Bronze" plans, which have an out-of-pocket maximum that's over $10,000 for an individual, likely leaving many people having to pay thousands of dollars in medical expenses despite having coverage.
By 2028, as Common Dreams reported earlier this year, catastrophic plans with lower premiums could have deductibles as high as $31,000 for families.
The plan to shift more people onto expensive plans that provide less coverage for day-to-day medical care—and to push patients to take out loans from their insurers—comes as about one-third of Americans, even those with insurance, report skipping meals or cutting back on other expenses to afford their medical bills.
The Times reported that at least one major health insurer—UnitedHealthcare, the nation's largest—is already equipped to start lending patients money to cover unexpected medical bills. The company operates a bank that administers loans to doctors and offers health savings accounts.
Rep. Shontel Brown (D-Ohio) said the latest proposal from the White House shows that President Donald Trump "is destroying healthcare from all sides."
The advocacy group Protect Our Care said the "suggestion" buried in the Centers for Medicare & Medicaid Services' final rule "is not only out of touch, it is cruel—accruing medical debt only adds to families’ financial burdens."
“While working families drown in the high cost of living, the Trump administration’s answer to the healthcare affordability crisis they created is to throw people an anchor made of medical debt and call it relief," said Leslie Dach, chair of Protect Our Care. "Trump and Republicans had a simple, popular fix sitting right in front of their faces—extending the ACA tax credits—but they killed it anyway, triggering premiums to double, triple, or even quadruple for millions of working families, all to make billionaires and big corporations even richer."
"Americans are being bankrupted by crushing medical debt, and this administration isn’t lifting a finger to help—it’s busy shoveling more people into that hole," said Dach. "Voters will remember this foolishness at the ballot box in November, just you wait.”
Melanie D'Arrigo, executive director of the Campaign for New York Health, which advocates for a universal, single-payer healthcare system for New York state, suggested the proposal makes the latest case for a federal, government-funded healthcare program similar to those in other wealthy countries, which would end the healthcare profit motive by expanding the existing Medicare system to the entire US population.
"Letting Americans take out loans to afford healthcare forces Americans deeper into debt and drives up profits for the health insurance industry," said D'Arrigo. "Abolish the health insurance industry. Demand Medicare for All."
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Trump CFPB Moves to Bar States From Wiping Medical Debt Off Credit Reports
One consumer advocate said the effort adds "salt to the wound" as tens of millions of people face healthcare premium spikes that are likely to worsen the nation's medical debt crisis.
Oct 28, 2025
The Trump administration is moving to undercut state-level efforts to wipe medical debt from Americans' credit reports, just as millions across the country are facing massive healthcare premium increases stemming from congressional Republicans' refusal to extend Affordable Care Act subsidies.
On Tuesday, according to reporting by The Lever and Bloomberg Law, the Russell Vought-led Consumer Financial Protection Bureau (CFPB) will publish a nonbinding interpretive rule arguing that federal statute "generally preempts state laws that touch on areas of credit reporting."
The guidance aligns with views expressed by a Trump-appointed federal judge in Texas who, earlier this year, vacated a Biden-era CFPB rule that would have prohibited the inclusion of medical debt on consumer credit reports. The Trump administration, which has repeatedly violated court orders, is complying with the decision.
Medical debt is a growing crisis in the United States: Roughly 14 million adults owe more than $1,000 in medical debt, and an estimated 20% of Americans have medical debt on their credit reports.
Supporters of removing medical debt from credit reports argue it is not a reliable measure of creditworthiness. The Center for Consumer Law & Economic Justice at UC Berkeley notes that "medical debt often reflects the simple misfortune of getting sick unexpectedly and having to face a medical system that is rife with insurance stonewalling, delay, and mistakes."
More than a dozen states—including California, Colorado, and New York—have moved to curb the reporting of medical debt, which accounts for a significant percentage of personal bankruptcies in the US.
The Lever reported that the Trump administration's position that federal law overrides state laws is being echoed "by industry groups to advance their ongoing litigation to overturn the 15 state laws."
"For example," the outlet observed, "the Consumer Data Industry Association, which represents credit reporting companies like Equifax, Experian, and TransUnion, is likewise arguing that federal laws void state-level regulations of their conduct as part of their effort to block Maine's medical debt law."
Chi Chi Wu, an attorney at the National Consumer Law Center, told Bloomberg Law that the Trump CFPB's assault on efforts to remove medical debt from credit reports adds "salt to the wound" as tens of millions of people face surging healthcare premiums.
Writing for MSNBC over the weekend, Century Foundation president Julie Margetta Morgan warned that "the spike in premiums won't just blow an even bigger hole in families' future budgets."
"It will pour gasoline on the already raging fire of medical debt in this country," she added, "and government leaders at all levels are not prepared for it."
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The Answer to Medicaid Cuts Should Be Medicare For All
Medicare For All is broadly popular, supported by the majority of the population, and affects everyone in the country. So what are we waiting for?
Jul 27, 2025
Following the recent passage of U.S. President Donald Trump’s domestic policy agenda, there’s been a lot of discussion about how the bill will affect average Americans. One provision which has received a lot of attention in particular has been the proposed cuts to Medicaid.
Medicaid represents a crucial stopgap for working Americans, one of the few things keeping our healthcare system afloat as costs have skyrocketed. Cuts to the program could have devastating effects. For instance, many of the country’s rural hospitals (as well as nursing homes and community health clinics) rely heavily on Medicaid payments and could be forced to shut their doors without them. It’s estimated this could lead to thousands of deaths.
The Democratic Party has yet to come up with a viable alternative to this. Fortunately, there’s a solution. And it happens to be supported by the majority of Americans—embrace Medicare For All.
America is the only country in the developed world without a universal healthcare system. Our current model for care is bloated, wasteful, inhumane, and driven by corporate greed. According to a 2024 report by the Commonwealth Fund, the U.S. ranked last when compared with 10 other wealthy, industrialized nations on metrics such as life expectancy, preventable deaths, and access to care, despite spending by far the most on healthcare.
It’s essential that we transition to a system that prioritizes patient care over profit.
There are several reasons why America’s system is so expensive (high administrative costs, the government’s inability to negotiate drug prices), but one crucial reason is that we’ve opted for a patchwork system. America has four models for healthcare—one system for the workforce, one system for people over 65, one system for veterans, and no system at all for the roughly 8% of the country that remains uninsured.
Pretty much every other country has settled on one model for everyone, because it’s cheaper and less convoluted. That’s the sensible way of doing things. In 2020, a comparative analysis of 22 separate studies found that Medicare For All would save billions, if not trillions of dollars, for Americans.
Medicare For All is broadly popular, supported by the majority of the population, and affects everyone in the country. We know that it works and would do an enormous amount to relieve people’s financial burdens. The top cause of bankruptcy in America is medical debt. This program would also save tens of thousands of lives every year. If it were to pass, it might secure a voting base for the Democratic Party for at least a generation, the way Social Security and the original Medicare bill did.
It’s essential that we transition to a system that prioritizes patient care over profit. We must follow the example of every other developed country and guarantee healthcare coverage to all our citizens as a basic human right.
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