Medical debt is surging in the United States, with Iowa leading the way, according to a new report from Whitley Law Firm. Between 2020 and 2023, Iowa saw a 54.97% increase in residents carrying medical debt, the sharpest rise in the country.
The findings, based on U.S. Census Bureau data, highlight stark contrasts across the states. While some regions are experiencing alarming growth in debt burdens, others have managed to slash the number of residents struggling with unpaid medical bills.
Iowa Tops the List
In 2020, just under 6% of Iowa residents reported having medical debt. By 2023, that figure had climbed to 9.20% — nearly 1 in 10 residents. That increase of almost 55% puts Iowa far ahead of any other state in the study.
Other States Facing Rising Debt
Several other states also reported steep increases in medical debt over the same three-year period:
- Hawaii: Up 34.87%, from 3.00% of residents in 2020 to 4.05% in 2023. Hawaii’s high living costs and limited healthcare access compound the challenge.
- Nebraska: Up 32.91%, from 8.51% to 11.30%, giving the state one of the highest overall debt rates in the U.S.
- Alaska: Up 32.22%, from 4.90% to 6.48%.
- Maine: Up 26.75%, from 8.04% to 10.19%.
By contrast, states such as South Carolina, Colorado, and New Mexico saw only small increases — under 10%.
States Making Progress
Not every state saw conditions worsen. In fact, several made dramatic progress in reducing medical debt:
- Delaware achieved the most dramatic improvement, cutting its medical debt rate by 80.29%. The percentage of residents with medical debt fell from 11.03% in 2020 to just 2.17% in 2023.
- Kansas reported a 42.66% decrease, with medical debt dropping from 10.38% to 5.95%.
- Kentucky reduced its rate by 38.53%, from 11.86% to 7.29%.
- Wyoming recorded a 35.24% decrease, from 13.73% to 8.89%.
- Alabama saw a 34.12% reduction, falling from 10.43% to 6.87%.
These states demonstrate that policy changes and consumer protections can have a significant impact on medical debt rates.
States With the Largest Increases in Medical Debt (2020–2023)
| Rank | State | 2020 Rate | 2023 Rate | % Change |
|---|---|---|---|---|
| 1 | Iowa | 5.93% | 9.20% | +54.97% |
| 2 | Hawaii | 3.00% | 4.05% | +34.87% |
| 3 | Nebraska | 8.51% | 11.30% | +32.91% |
| 4 | Alaska | 4.90% | 6.48% | +32.22% |
| 5 | Maine | 8.04% | 10.19% | +26.75% |
The Human Impact of Medical Debt
Medical debt is unlike other forms of debt because it is rarely voluntary. Families often incur it following unexpected emergencies, chronic illnesses, or necessary treatments. Even insured households can find themselves overwhelmed by deductibles, co-pays, and services not covered by their plans.
A spokesperson for Whitley Law Firm said:
“This study shows an alarming rise in medical debt across several states, with Iowa’s nearly 55% surge being particularly concerning. These financial burdens affect families’ stability and can force impossible choices between healthcare and other essential needs.
Over 60% of U.S. bankruptcies are linked to medical debt. The sharp reductions we’ve seen in states like Delaware suggest that targeted policy measures can make a real difference in protecting families from financial ruin.”
Looking Ahead
The study’s findings underline the uneven landscape of medical debt in America. While some states are experiencing a crisis, others are proving that progress is possible.
Experts suggest that a mix of expanded healthcare coverage, consumer protections, transparent pricing, and debt relief initiatives could help alleviate the burden nationwide. Without intervention, however, families in high-debt states risk falling deeper into financial instability.
