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Archive for the ‘Medical Care Costs’ Category

If I Have Overdue Medical Bills, Can I File for Bankruptcy?

July 27th, 2020 at 11:42 am

TX bankrutpcy attorney, TX chapter 7 lawyerThe U.S. has some of the highest medical costs in the world, leaving many patients who visit the emergency room or go to the hospital financially destitute. Even those who have health insurance may find that their coverage is not enough to fully cover their necessary medical treatments. No one can predict the manifestation of serious illnesses or accidental injuries, but you rarely have a valid choice, leaving you to choose between unwanted debt or suffer the possibly fatal consequences. If you find yourself overwhelmed with medical debt, you do have legal options to help you payback the costs overtime or relieve yourself of the costs altogether. Filing for bankruptcy may be your last resort, but it may also be your only chance of moving forward.

“Medical Bankruptcy”

Those whose debt is solely made up of pastdue medical bills may believe that they can file for “medical bankruptcy” and avoid their other assets getting involved in the process. There is no type of bankruptcy known as medical bankruptcy; however, medical bills are a common reason that people file for bankruptcy. Medical debt falls under the same category, known as unsecured debt, as credit card debt, personal loans, old utility bills, and borrowed money from family or friends. Since bankruptcy cases must be equally fair for both the debtor and creditor, you must list all of your debts, personal property, and real estate within your bankruptcy case. There are two ways that most people file for bankruptcy: Chapter 7 and Chapter 13 bankruptcy, both of which have a large impact on your credit score.

Chapter 7 Bankruptcy

Filing for Chapter 7 bankruptcy is often the more desired option since it discharges or forgives all of your debts, not requiring you to pay them back. Any medical debt that you have accumulated can be included in a Chapter 7 bankruptcy claim. The process typically only takes four to six months to complete and grants immediate relief to those filing for this type of bankruptcy. There are a few types of debt that cannot be discharged, such as income taxes and past-due child support or alimony payments. While Chapter 7 is often the most desirable option, since you will not need to pay the debt back, there are strict eligibility requirements. If your household income is lower than the state median income, you are eligible to file Chapter 7 bankruptcy.

Chapter 13 Bankruptcy

This type of bankruptcy extends your timeline for paying back your debts, creating a three to five year payment plan for debtors. Chapter 13 bankruptcy is the common option for those who have a steady income, allowing them to pay off their debts while still having disposable income. The amount owed is dependent upon your debt amount and your income. Depending on your situation, your amount owed could be reduced and you may have your remaining debt discharged at the end of your payment plan. Any missed payments can lead to the seizing of your assets.

Contact a New Braunfels Bankruptcy Attorney

As you can see, there are a number of factors that can contribute to your ability to file for bankruptcy and which type of bankruptcy is best for your situation. It is always advised to speak with a well-seasoned attorney who understands your state’s policies regarding filing for bankruptcy. The Law Offices of Chance M. McGhee has over 20 years of experience assisting Texans overcome their debt difficulties, including those that consist of significant medical costs. Contact our Boerne bankruptcy lawyer at 210-342-3400 to discuss the details of your case during your free consultation.

 

Sources:

https://www.thebalance.com/what-to-know-about-filing-medical-bankruptcy-4159606

https://www.creditkarma.com/advice/i/medical-debt-in-bankruptcies

https://upsolve.org/learn/get-rid-of-medical-bills-in-bankruptcy/

 

The Real Number One Reason for Bankruptcy Filings

February 18th, 2015 at 12:13 pm

medical care and bankruptcy, San Antonio bankruptcy lawyerHistorically, filing for bankruptcy was typically not considered an option for many people who found themselves struggling with mounting and uncontrollable debt. The stigma attached to bankruptcy was one of shame and failure. However, over the past decade or so, that stigma began to fade as many people realized that bankruptcy was often the only solution to the financial crisis they found themselves in.

In 2012, over 1.2 million people in this country filed for bankruptcy. Prior studies have shown that the leading causes of bankruptcy are medical expenses, unemployment, unexpected life events, and credit card debt.

But just how much of role do medical expenses play in causing people to have to file for bankruptcy? Is it actually one of the leading reasons as we have been led to believe? Many analysts and studies point to the high price of medical care–not only for people who have no medical insurance–but also for people who do have medical coverage as the number one leading cause. It has been cited as the cause of sixty percent of bankruptcy filings each year. However, this statistic was actually garnered from a 2007 Harvard University study. A recent study reached different a conclusion.

The Center for Consumer Recovery analyzed over 3,000 bankruptcies which were filed in 2012. The research team looked over each bankruptcy petition and credit report of each participant, as well as conducted an interview with each one. They found that medical expenses were not the leading cause of the bankruptcy. Instead, in 78 percent of the study cases, it was debt litigation that resulted in the bankruptcy filing.

Three-fourths of participants shared the common experiences of harassment form collection agencies and debt collection companies, including threats of lawsuits. It was these threats and harassment that forced the decision to finally file for bankruptcy.

If you are being threatened and harassed by creditors, bankruptcy may be the best option for you. Contact an experienced bankruptcy lawyer in San Antonio today for a free consultation.

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