U.S. household debt increased by $334 billion in the third quarter, reaching $19.1 trillion, according to new data from the Federal Reserve Bank of New York. Credit card balances accounted for part of that rise, climbing to a record $1.29 trillion as households continued to face higher everyday expenses.
The figures, reported on Nov. 12, do not directly capture the full scale of medical debt. Medical bills can instead appear in the data after consumers use a credit card, home equity line or another form of borrowing to pay them. That can make the original medical expense difficult to identify in household debt statistics.
Medical bills can move into other forms of debt
An analysis of 2021 federal survey data by KFF, a national nonprofit health care research group, estimated that Americans had $220 billion in medical debt. Jim Triggs, chief executive of nonprofit credit counseling organization Money Management International, said a medical obligation effectively changes categories when a consumer pays it with borrowed money.
“Technically, as soon as that consumer pays that debt off with another mechanism, now it becomes credit card debt, or housing debt, or whatever mechanism you used to pay it off,” Triggs said.
Medical hardship was identified as a factor in 20% of the debt and budget counseling clients served by Money Management International in 2025, Triggs said. Separately, a 2025 study by researchers at the Consumer Financial Protection Bureau found that about 17% of households surveyed in 2024 still owed money on a loan or credit card used to cover a medical bill.
| Measure | Figure | Period or source |
|---|---|---|
| Total household debt | $19.1 trillion | Third quarter; Federal Reserve Bank of New York |
| Increase in household debt | $334 billion | Third quarter |
| Credit card balances | $1.29 trillion | Third quarter; record level |
| Estimated medical debt | $220 billion | Analysis of 2021 federal survey data by KFF |
Credit cards and home equity borrowing both increased
The New York Fed’s data showed that credit card borrowing rose alongside broader household debt. Home equity lines of credit also increased, reaching $481 billion, the largest quarterly jump since 2005. A home equity line allows a homeowner to borrow against available value in a property, making it another channel through which expenses can become debt recorded outside a medical-debt category.
The increases came during a period of affordability pressure, with consumers paying more for everyday goods and services amid persistent inflation. Julie Margetta Morgan, president of the Century Foundation, said high-deductible health plans can leave insured households with large bills that they cannot immediately pay.
“There's a big piece of medical debt that is about people being on high-deductible health plans, so they have insurance, but they're still getting these big medical bills that they can't pay,” Margetta Morgan said.
Medical debt can also appear in collections data. The Urban Institute reported that, among households with medical debt, the median amount in collections was $1,492. Its report used more than 10 million anonymized credit bureau records from August 2026. Those records provide a separate view of unpaid medical obligations from the New York Fed’s broader household-debt measure.
The combined figures show why credit card balances and other borrowing can obscure the expense that initially caused a household to take on debt. Once a bill is transferred to a card or another loan, the balance is counted according to the borrowing product rather than necessarily identified by its medical origin.
