Medical bankruptcy can become the only option for a person, regardless of their current financial situation or the type of health insurance they have. Those without insurance are at the greatest risk of falling into the abyss of overwhelming medical debt. However, in this economy, with fewer employers offering comprehensive and comprehensive health plans, the well-insured are also vulnerable. This is due to something in your policies known as a deductible.
Everyone is vulnerable to catastrophe. When a person is admitted to the hospital with a serious illness or serious injury, initial treatment can cost hundreds of thousands of dollars, as in the case of a heart attack or multiple injuries. Long-term treatments increase the cost and the therapy even more. Medical bills totaling more than a million dollars are not uncommon. The insurance will pay only the amount, less the deductible and the copay. So, for example, a medical bill of $ 100,000.00, assuming it is all initial treatment and care, is subject to a 20 percent copayment and a 10 percent deductible. That is approximately $ 30,000.00. Add to that therapy, corrective surgery, anesthesia, and many other procedures and treatments, all subject to the same deductions, and you have a mountain of debt.
Bankruptcy, in the form of Chapter 7 or Chapter 13, is often an answer. Chapter 13 allows a person to keep any assets while paying debts over a period of three to five years. This may not be possible for debts of 50K or more, unless the person can return to a high paying job. Chapter 7 removes the debtor’s responsibility for payment and uses the sale of personal assets to pay all or part of the debts. Chapter 7 is a good option in many cases. The declarant keeps his house and his car, furniture and clothes and can start over. A good bankruptcy attorney should be hired to navigate through the process and protect you from creditors who refuse to follow the rules and continue to harass you.
Will medical bankruptcy hurt your credit so much that you can never borrow money? Bankruptcy, although it is a mark on your credit that can last ten years, is not the end of the world. Taking out a bank-secured credit card or keeping one card up-to-date and getting out of bankruptcy is a good way to start rebuilding your credit.
