Why More Medicare Seniors Are Struggling With Medical Bills — and Ways to Reduce Them

Nearly 18% of Americans age 65 and older reported medical debt even though most are covered by Medicare, according to recent data. Surprise bills, dental costs, and coverage gaps can still strain retirement finances.

Higher health care costs, along with avoidable gaps in coverage, are pushing more older adults into medical debt, according to new findings.

A recent report from the Urban Institute and the Robert Wood Johnson Foundation says 17.6% of adults 65 and older are carrying medical debt, even though nearly all Americans in that age group have Medicare.

Medicare Coverage Still Leaves Gaps

“Right now, about one in 10 people are only covered by original Medicare, which is, in my opinion, a huge mistake,” Mike Boshardy, a Medicare attorney and licensed Medicare advisor, told SavingAdvice. His company, The Pocket Protector, is a brokerage that lets clients compare and enroll in Medicare supplement and Medicare Advantage plans online.

“You need to have some form of supplemental coverage, and the reason for that is the potential of co-insurance that you’re going to be faced with,” Boshardy said. “Because if something does go wrong, and as we all know in life, it’s not if, but when, then you’re going to get stuck with a very large bill that you likely cannot pay.”

Millions of Older Adults Face Large Unpaid Bills

“I care for 3,000 to 3,500 patients a year, and about 1,500 of them are on Medicare or Medicaid,” Dr. Harsha Moole told SavingAdvice. “Medical debt in seniors is not an abstraction to me. I watch it happen at the bedside.”

Moole practices internal medicine at Stormvale Health in Topeka, Kansas, and founded FindMyDirectDoctor, a national registry of concierge physicians who accept upfront monthly fees from patients instead of insurance.

The Consumer Financial Protection Bureau estimates that nearly 4 million older Americans have unpaid medical bills totaling about $53.8 billion. That amounts to roughly 7% to 8.5% of people over 65.

KFF reports that about one in 10 seniors with medical debt owe $10,000 or more. A CFPB report placed the average debt at $13,800. Among seniors with medical debt, 41.2% have been contacted by a collection agency.

What Is Driving the Debt

A KFF report found that traditional Medicare beneficiaries spent an average of $1,107 out of pocket on dental care. The same report says dental treatment is the second-largest source of medical debt for older adults, just behind lab fees and diagnostic tests. Common sources of debt for adults over 65 include:

• Lab fees and diagnostic tests (49%)
• Dental care (48%)
• Doctor visits (41%)
• Hospitalizations (34%)
• Emergency care (31%)
• Prescription drugs (24%)
• Ambulance services (19%)
• Mental health (6%)
• Long-term care (6%)

Dental Coverage Remains One of the Biggest Gaps

It may be surprising to see dental care ranked so high among debt sources for older adults, but Boshardy says much of that burden can be avoided.

“In the statistic for roughly one out of five seniors carrying medical debt, that includes dental,” Boshardy said. “So, if you are in a position where you are going to need a root canal or a bridge or something goes wrong with your dentistry, that’s another area where you need to have proper coverage.”

He noted that many Medicare Advantage plans include dental coverage with a $0 premium. By contrast, adding dental coverage to a Medicare Supplement plan usually requires a separate policy from another insurer and comes with a monthly premium.

How Medical Debt Affects Seniors

Debt can be especially stressful for retirees living on fixed incomes. Research from the National Council on Aging shows that many older adults with medical debt are cutting back on essential expenses.

Among seniors with medical debt, 42% have reduced spending on food and other necessities or are using credit cards and loans to cover costs, according to NCOA. KFF also reports that 62% are skipping doctor visits and prescriptions because of debt.

“Here is what it looks like on the ward,” Moole said. “Patients stretch inhalers past the date on the box. They cut pills in half without telling anyone. They cancel follow-up visits because the co-pay competes with the electric bill. When care becomes unaffordable, nobody files a complaint. They just quietly stop coming. Then they show up in the ER much sicker, and the bill they were avoiding becomes a much bigger bill.”

How Original Medicare Parts A and B Work

To understand the gaps in traditional Medicare, it helps to know what Parts A and B cover.

Part A is hospital insurance. It helps pay for inpatient hospital care, skilled nursing facility stays, surgery, hospice care, and some home health services. Part B helps cover doctor visits, outpatient care, some preventive services, and certain medical equipment and supplies.

Traditional Medicare covers only part of medical expenses, not all of them. That is where the coverage gaps begin.

Beneficiaries can help fill those gaps with added coverage such as Part D for prescriptions or separate dental and vision plans. Medicare Advantage plans are another option and often include dental, prescription, and vision benefits, along with other extras.

Cost remains a major issue for many people. Traditional Medicare and supplemental plans can cost hundreds of dollars a month. Medicare Advantage plans often have no premium.

Even so, a zero-premium Medicare Advantage plan still has limits. For example, the out-of-pocket maximum for in-network services in 2027 is $9,850. That can still be a heavy burden for people with limited resources, though it is better than the 20% uncapped coinsurance that comes with original Medicare alone.

Medicare coverage costs can vary, and Medicare provides a full breakdown of expenses.

Where to Find Help With Medical Debt

Medical debt can feel overwhelming, but several resources may help.

• NCOA BenefitsCheckUp. This free online tool lets older adults check eligibility for federal, state, and local assistance for a range of needs.
• Eldercare Locator. Run through the Administration for Community Living, part of the U.S. Department of Health and Human Services, this service helps people find financial assistance online, by email, by text, or through live chat at 1-800-677-1116.

Other cost-cutting programs for moderate- to low-income Medicare beneficiaries include:

• Medicare Savings Programs (MSPs). These state-run programs help pay Medicare premiums and may also cover deductibles and coinsurance.
• Extra Help. The Social Security Administration runs this program to lower Part D prescription drug costs.

If you already owe medical debt, these organizations may help:

• Dollar For. This nonprofit seeks hospital debt forgiveness and refunds for past payments, and it helps people complete applications for financial assistance when available.
• Undue Medical Debt. This group uses donor funds and public programs to eliminate medical debt. Income or debt limits apply.
• Patient Advocate Foundation. PAF offers free case management, help with medical bills and insurance appeals, and small financial grants for patients facing serious, chronic, or life-threatening illnesses.

Hospitals Are Expanding Access to Financial Help

Nonprofit hospitals are required under federal law to offer financial assistance to low-income patients. But the application process can be confusing and time-consuming. To address that, some states have adopted “presumptive eligibility” laws that require hospitals to automatically screen uninsured patients, Medicaid enrollees, and patients with bills above $1,500 for financial assistance before billing them. That can erase or reduce what patients owe.

Oregon was the first state to adopt such a law, and California’s version is set to take effect this summer. Other states are also considering the approach.