Medical Emergencies: Leading Cause of Bankruptcies in the United States

There are various reasons why people file for bankruptcy. What may seem like shocking news is that most people are ONLY ONE major health issue away from considering bankruptcy as an option. How can this be when most families have some form of health insurance? On the one hand, everything depends on a series of circumstances. Here are some examples of what to consider:

• What kind of insurance do you have?
• What kind of medical problem do you have?
• What is the copay percentage?

Medical bills are actually the biggest cause of bankruptcies in the United States. In 2013 alone, nearly 2 million people filed for bankruptcy citing medical bills as the reason. Even health insurance provides minimal help in preventing these cases.

Why?

One reason is that the average copay in most plans is 20%. This works well for checkups and minor injuries, but if you get seriously ill or have a serious accident, you could potentially rack up a bill of more than $50,000 where you would have to cover 20% or $10,000 along with the deductible. . For almost anyone, this would be a life changing tragedy and would require seeing a bankruptcy attorney.

Who is affected?

Of those who cited medical bills as their reason for filing for bankruptcy, 78% of them had some form of health insurance. Most of those affected were educated, middle-class families. 1 in 5 Americans will have trouble paying medical bills this year. Accidents and life-changing diagnoses can happen to anyone.

Even with adequate savings and good spending habits, the burden of some medical bills is simply too much for most people. This is a problem that an estimated 56 million Americans will face this year alone.

What can happen?

Since most health care institutions use their own means to collect debt, overdue health bills are treated the same as other types of debt, regardless of the fact that you are now unable to keep your job due to your problem. of health. You can expect similar means of debt collection, such as multiple phone calls, court-ordered actions, and other harassing techniques.

How to tackle the problem?

Bankruptcy is, and should always be, considered as the final option and should only be seriously considered once all other options have been exhausted. Lawyers who specialize in bankruptcy are also experts when it comes to finding working solutions for debt. Your best course of action would be to seek the assistance of a bankruptcy attorney as soon as you are faced with a massive medical bill.

The common belief is that credit card debt or mortgages are the main causes of filing for bankruptcy. Most people are caught off guard by bills so high that they find themselves at a loss for what to do. Just knowing that 3 out of 5 bankruptcies are caused by medical bills is already a good start. Knowing is always half the battle and is always better than being caught off guard.