Anyone who runs up credit card must be buying too many gameboys. At least that’s the view of lots of folks in DC who write the laws governing credit, bankruptcy and the like. I wonder what they will make of a new report released today examines the “medically indebted” — the people who charged medical expenses to their credit cards and then couldn’t pay off the bills.
The report is a double indictment. It focuses on the financial impact of an inadequate health care system and lack of health insurance, but just below the surface is a reminder that people are paying 29% interest and $39 late fees as they try to pay off medical debts that have morphed into credit card bills. Nearly 2 out of 3 (62%) of the medically indebted had received calls from debt collectors. That’s a great get well call: pay up or we’ll make more trouble for you.
There is much talk about personal responsibility and credit card debt. There are undoubtedly many who are thoughtless, or downright abusive, in the use of credit. But the Demos study is a sober reminder that a substantial portion of America runs up credit because they simply can’t make it otherwise.