Medical Bills Major Cause of Bankruptcy for Ohio Residents
Life can be expensive. And it is no fun for anyone who must admit to family and friends that they are experiencing financial difficulty. But when a medical emergency happens, the hit to your finances can become quickly overwhelming.
It is not uncommon for Americans who have saved their entire adult lives for retirement to quickly use up these savings to satisfy medical bills they will never completely pay off. Medical expenses are the main problem for many Americans who are forced to file bankruptcy.
Bankruptcy and Medical Debt: The Link
Several studies have been conducted that seek to pin down the causes of bankruptcy. This is sometimes a difficult goal to accomplish because bankruptcy filers are not required to disclose reasons for their financial trouble. The data that exists is the result of personal surveys.
One report suggests that medical bills are the root cause of about one-fourth of the bankruptcy filings in America. Other studies report numbers significantly higher. One study conducted in 2007 that included Senator Elizabeth Warren as a researcher, concluded that medical bills were a factor in 62 percent of bankruptcy filings.
Why is Medical Debt so High?
The factors that can cause medical debt to overwhelm a family are seemingly never ending. These factors include:
- The presence of a rare and serious disease.
- The progression of a chronic illness.
- An accident that causes a severe injury.
- Surgeries that result in lengthy recovery times.
Each of these situations brings with it the additional burden of not being able to work. One study demonstrated that 40 percent of the people involved in an accident or fighting a serious illness lost a significant portion of their income.
Everyone at Risk
It may be easy to assume that people with low incomes who fail to maintain medical insurance are the only people that cannot afford to pay their medical bills. But the truth is that people of all income levels can be financially devastated by medical expenses.
One survey discovered that 78 percent of people forced to file bankruptcy due to medical expenses were insured. Additionally, a large percentage of these individuals were college-educated with well-paying jobs.
The Continued Rise of Medical Costs
The skyrocketing costs of medical care in the United States means that bankruptcy rates will probably not decrease in the foreseeable future. One tracking system reported that health care expenditures for the United States eclipsed $3.6 trillion in 2018. To put this in perspective, the cost per capita in the country for health care in 1970 was $355. By 2018, this number was $11,172. Additionally, the price of health care increased by 16 percent from 2012-2016. This number was three times the rate of inflation over the same time period.
When Your Medical Bills Become Too Much to Handle
If you find yourself unable to meet your monthly financial obligation due to the medical expenses you have accumulated, it is probably time for a sit down with an experienced bankruptcy attorney. The bankruptcy process will allow you to either eliminate or restructure the debt you owe and the type of bankruptcy you file will be matched to your situation.
Wood & Brewer LLC is here for you when your medical bill situation is overwhelming. We offer a free consultation to do our part in helping you see the light at the end of the tunnel when dealing with financial stress. We invite you to contact us today!