Does Medical Debt Lead to Bankruptcy?

Medical care in the United States is expensive. Even some individuals who have decent insurance find that the co-pays, deductibles and uninsured costs are expensive. It isn’t really surprising that medical debt is the top reason why people consider either filing for bankruptcy or taking money out of their retirement accounts.

There are a few things to consider when you’re weighing filing for bankruptcy due to medical bills. One of these is that you can’t file only for the health care debts. All of your creditors have to be named in the bankruptcy so that there isn’t any favoritism. This is good news for many people because it gives them a fresh financial start without having to try to struggle to pay off other creditors.

Another consideration for some people is that they may have to find a new doctor if they file for bankruptcy. While many doctors understand that people will have financial difficulties, others take a hard stance against seeing patients who had prior balances discharged.

Sometimes, doctors and medical centers might require you to pay for services when they’re received if you had medical bills discharged in bankruptcy. This isn’t always possible in some cases, such as when you visit an emergency room. If you need life-sustaining or stabilizing treatment, the emergency room must provide it without consideration of your ability to pay, so you’ll still be able to receive that type of care.

You must ensure that you carefully consider all the ways that the bankruptcy can impact you before you file. Some people think about the negative ones, but there are some positives, such as a clean financial slate and the halting of collectors hounding you about debts. Bankruptcy initiates the automatic stay. Your bankruptcy attorney can help you learn about the impacts bankruptcy may have on you.