A recent study found medical expenses are a major contributing factor in bankruptcy filings among older Americans. The study, conducted by John Pottow of the University of Michigan Law School, revealed overall the elderly make up a relatively small percentage of those filing for bankruptcy; however, their numbers are growing at a startling rate.
In 2007, for example, the percentage of bankruptcy petitions filed by those ages 65 to 74 was 178 percent higher than in 1991. That increase occurred during the period before the 2008 recession, so current figures are likely even higher due to the recession’s impact on jobs, retirement portfolios and housing values.
At least some of the financial woe suffered by seniors can be attributed to skyrocketing health care costs. According to the Center for Retirement Research at Boston College, the average married couple can expect to spend $197,000 on health care stemming from issues, such as insurance premiums, out-of-pocket fees and home and long-term health care costs. When nursing home care is included, the figure rises to $260,000 with a 5 percent chance of reaching $570,000.