Medical Debt Burdened 27 Percent of U.S. Adults in 2025

As employers shift costs and coverage changes, medical debt affects a significant share of insured workers.

Updated on Oct. 6, 2026 in Healthcare

Bold flat-color editorial illustration depicting a stylized hospital facade in navy, cream, and red, representing the systemic weight of medical debt. — Twenty-seven percent of U.S. adults reported holding medical debt in 2025, a figure that includes over one-quarter of those with health insurance coverage. AI Illustration. Upload story photo >

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Is the burden of medical debt for your household getting worse compared to previous years?

In 2025, 27% of U.S. adults reported holding medical debt, with 26% of those having health insurance. These figures highlight persistent financial strain across the workforce despite coverage levels.

Why it matters

Rising medical debt creates downstream pressure on employee productivity and retention, as workers balance unpaid bills against increasing out-of-pocket health costs. These challenges are expected to intensify as employer-sponsored cost-sharing grows and federal coverage shifts occur.

The Urban Institute study of over 10,000 adults found that 54% of debtors owed at least $1,000, while 16% carried balances of $5,000 or more. Furthermore, 35% of those with debt faced contact from collection agencies in the past year.

The players

Urban Institute

A nonprofit research organization that provides data and evidence to improve public policy and private sector decision-making.

The details

The debt was primarily driven by hospital services, which accounted for 52% of medical debt reported, followed by specialist care at 42%. Data collection performed in December 2025 reflects a landscape where medical debt affects even those with insurance, suggesting that high-deductible plans or coverage gaps remain significant operational friction points for households.

December 2025: Survey data for the study was collected.
2025: Twenty-seven percent of U.S. adults reported holding medical debt.

Market Landscape

These figures highlight a departure from the expectations set by the Affordable Care Act, which aimed to curb financial insolvency linked to healthcare expenses. The data confirms that widespread medical debt remains a persistent trend regardless of individual insurance status.

Owners should account for medical debt as a factor in employee financial wellness and potential garnishment or workplace stress. Reviewing the impact of current health plan structures on employee out-of-pocket liability is an essential operational step for the coming year.

The takeaway

Medical debt is now a common financial hurdle that affects insured employees and shifts the landscape of workforce stability. Operators should monitor the cost-sharing structures within their benefit plans to understand how these designs influence the financial health of their staff.