Bankruptcy often the only solution when unexpected medical bills arise
As countless Georgia families continue to struggle under the weight of the slowly-recovering economy, many discover that by simply “tightening their belts” they can realize substantial cost savings. Unfortunately, one expense that many families find difficult to eliminate, if not impossible, is unexpected or emergency health care costs – after all, there are not many alternatives available when a family member’s health, or even life, is at stake.
Sadly however, the exorbitant costs of health care can often overwhelm the budgets of even the most cost-conscious individuals in Georgia. To make matters worse, according to the Georgia Budget and Policy Institute, almost 1.9 million Georgians under the age of 65 – which is more than 20 percent of the population – had no health insurance from 2010-2011. This means that many cash-strapped individuals may be stuck footing entire hospital bills when medical emergencies strike.
Consequently, it should come as no surprise that past studies have discovered that as many as 60 percent of bankruptcies can be attributed to, at least in part, insurmountable medical bills.
Difficulties paying medical bills
Medical bills can quickly become unmanageable due to several reasons. For instance, the struggling economy has led to the loss of several jobs in Georgia – which translates to more individuals losing their employer provided health insurance. This means they either pay monthly insurance premiums out of their own pockets, or gamble that they will not need medical care and forego insurance altogether. Financial problems arise when an unexpected illness or accident occurs and they become responsible for all of their medical bills.
Conversely, being employed and having health insurance doesn’t guarantee protection from medical bills. For instance, as health insurance premiums continue to rise, many are choosing to have higher deductibles so their monthly payments are lower. However, with high deductibles people can also get into financial difficulties when they need medical care because they cannot afford their out-of-pocket costs.
Bankruptcy may help with medical debt
A study conducted by the Center for Studying Health System Change revealed that one in five U.S. families were unable to pay their medical bills in 2010, and that this figure remained steady since 2007. Thankfully, bankruptcy may provide relief for many of these families attempting to deal with crushing medical debt.
For example, once a person files a bankruptcy petition, the court issues an automatic stay on all collection actions. This person will no longer have to deal with debt collector harassment or wage garnishments. Additionally, since medical bills are unsecured debts they can be discharged during a Chapter 7 bankruptcy – meaning they will be permanently wiped out.
Therefore, if you are currently facing uncontrollable medical debt and believe a Georgia bankruptcy may be able to help, it is often a good idea to contact an experienced bankruptcy attorney. A skilled bankruptcy attorney can outline what your options may be and assist with the filing process.