Ovewhelmed with Medical Debt: Getting Bankruptcy Help

You may be in over your head with medical bills, and your credit may have suffered considerably as a result.  You may have no means to make payments on these debts, and consequently you may be falling behind on other bills as well.   Remember, you are not alone.  Medical debt accounts for over 60 percent of all bankruptcies in the United States, and nearly 2 million Americans are forced into bankruptcy for medical reasons.   

Understanding a Medical Bankruptcy

You may have had medical coverage when you first became ill or disabled, and yet you are still drowning in medical bills.  There are several reasons why this can occur: 

• Your insurance company dropped you when you became sick or disabled, resulting in your medical treatment becoming a 100 percent, out-of-pocket expense.  Unfortunately, many companies are permitted to drop your coverage, legally.
• You were unable to continue working, due to your illness or disability, and thus lost the medical coverage that came with your job.  Without employment, you are unlikely to maintain not only medical insurance coverage, but also the means with which to pay an outstanding medical bills.
• You were simply unable to afford medical insurance in the first place.

Whatever the case may be, you may be left with exorbitant medical bills, which are essentially unsecured debts.  These debts are like credit card bills – they have no collateral that a creditor can take as a form of repayment.  So, if you ultimately do not file for bankruptcy, and you fail to pay these bills over time, an insurance company or a hospital can claim part of the equity in your house, your business, or any other form of property that you may own.  They can also garnish portions of your income, if you have not already filed for bankruptcy protection.   

Getting Rid of Medical Bills with Bankruptcy

If you are overwhelmed by your medical bills, there are several important steps you can take: 

• Contact a bankruptcy attorney, your accountant, or some other bankruptcy professional to get advice for your specific situation.  An attorney may also be able to help alleviate the emotional pressures that come with the difficult creditors’ phone calls you may be receiving.
• Determine if you need to continue to see the same medical professionals, and make sure you discuss the feasibility of such continued care with your attorney.
• If your medical bill a one-time problem, your attorney may help you make a payment plan that works for you and your needs.
• Determine with your attorney if bankruptcy is your best option.  Educate yourself with the pros and cons of filing for bankruptcy to alleviate the pressures of medical bills.

Getting Help

An experienced bankruptcy attorney is ultimately the best resource for deciding what will work for your situation. He can help you evaluate whether bankruptcy is your best option, as well as give you guidance both on what type of bankruptcy to choose and on how to actually move through the process in the courts.