Medical Debt

The Reasons to Avoid Paying Medical Bills with Credit Cards

Most people hope to avoid having long-term medical debt on their credit report, which is why it can be tempting to want to pay off medical debt with a credit card. However, the consequences that come along with using one form of debt to pay off another can be enough to want to keep anyone from taking this route.   

Medical debt is reported to be the number one cause of U.S. bankruptcy filings. It has been reported that over two-thirds of all bankruptcies between 2013 and 2016 involved medical debt. According to a 2019 study, one in every three households carried credit card debt after using credit to pay off medical bills.  

Putting medical debt on a credit card is oftentimes a way of delaying the inevitable.  It is important consumers know that medical providers are often more than willing to work out a payment arrangement if a consumer is not able to pay his or her medical bill in full.

However, they will normally wait for the patient to reach out to them first to work out this arrangement. Occasionally, they will negotiate with the patient on a reduced lump sum amount to pay off the bill in full. If the provider is not willing to reduce the amount owed, they may be willing to workout a payment installment plan.

Other steps may be helpful to avoid incurring large amounts of medical debt. According to the Urban Institute, in 2018, the average maximum out-of-pocket medical expense for an individual was $4,416, while it was $8,375 for a family unit. The problem is many households do not even have $1,000 to cover emergency expenses. Financial experts recommend building up an emergency savings fund to save for any potential out-of-pocket medical expenses, especially if the individual is anticipating a big procedure or test in the future.

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Those who have experienced illness or injury and found themselves overwhelmed with medical debt should contact an experienced Miami bankruptcy attorney. In bankruptcy, medical bills are considered general unsecured debts just like credit cards. This means that medical bills do not receive priority treatment and can easily be discharged in bankruptcy. Bankruptcy laws were created to help people resolve overwhelming debt and gain a fresh financial start. Bankruptcy attorney Timothy Kingcade knows how to help clients take full advantage of the bankruptcy laws to protect their assets and get successful results. Since 1996 Kingcade Garcia McMaken, P.A. has been helping people from all walks of life build a better tomorrow. Our attorneys’ help thousands of people every year take advantage of their rights under bankruptcy protection to restart, rebuild and recover. The day you hire our firm, we will contact your creditors to stop the harassment. You can also find useful consumer information on the Kingcade Garcia McMaken, P.A. website at www.miamibankruptcy.com.

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