Medical Debt

Tips for Dealing with Medical Debt Collections

Medical debt affects so many Americans. After suffering a serious injury or illness, it can be hard to pay the bills that will inevitably follow. In fact, more than 137 million Americans say they are struggling to pay their medical debt. According to a study published by the Journal of Internal Medicine, this many adults have faced some type of medical financial hardship in the past year.

When someone is sick or injured, it will often cause them to miss work or they may not be able to return to work ever again. Due to the loss of income and oftentimes the loss of insurance, the person will struggle to pay their medical bills when they become due.  Their financial situations can get so out of control that many of these individuals are forced to dip into their retirement savings prior to reaching retirement age to pay off some of their bills. However, pulling savings early will only help so much, which is why so many consumers end up filing for personal bankruptcy as a result. It is reported that 66.5 percent of all personal bankruptcies are related to some type of medical debt.

Bankruptcy Law, Debt Relief, Medical Debt

How the Insured Fall into Medical Bankruptcy

There was a time when having health insurance was enough to assure someone that his or her medical expenses would be adequately covered and that he or she would not fall into debt due to one major medical crisis. However, today’s high deductible insurance plans and skyrocketing medical costs have made it impossible to stay out of medical debt. It is for this reason that so many American consumers are falling into what is called “medical bankruptcy” or bankruptcy due to medical debt.

According to a study published by the American Journal of Public Health, 530,000 bankruptcies are filed annually due to medical debt. Even with coverage offered through the Affordable Care Act, consumers are still struggling to afford their medical bills. A lot of this has to do with the insurance coverage options and healthcare plans offered.

Bankruptcy Law, Medical Debt

Why So Many Americans Over the Age of 55 are Filing for Bankruptcy.

Bankruptcy offers filers a fresh financial start, but for many bankruptcy petitioners, that start comes later in life. In the past three decades, the number of people over the age of 55 who have filed for bankruptcy has gone up significantly. This increase has many financial experts wondering why so many individuals nearing retirement are filing for bankruptcy.

According to a paper by Robert Lawless, the percentage of older Americans, specifically between the ages of 55 and 64, increased by 66 percent between the year 1991 and 2016. The number of bankruptcies filed by individuals between 65 and 74 increased by more than 200 percent between this time period. In fact, approximately 12 percent of all bankruptcy filers are over the age of 65.

Debt Relief, Medical Debt

Medical Debt Cited as a Leading Factor in U.S. Mortgage Denial

Approximately a quarter of homebuyers and renters carrying personal debt were denied approval for either a mortgage or lease, according to Zillow’s recent report on Consumer Housing Trends. It was reported that medical debt had the most impact on homebuyer’s budgets and whether they would qualify for a mortgage.

While student loan debt has been reported as being a major factor keeping many younger people from purchasing a home, it turns out medical debt is an even bigger factor.

According to Zillow, medical debts are more likely than any other type of debt to keep American consumers from either purchasing or renting a new home. They conducted a survey which showed that 38 percent of people who owe money for medical or healthcare expenses say they were turned down for renting a home or taking out a mortgage due to those debts. According to Zillow, this group represented the largest rate of rejection- more than any other kind of debt, including credit cards and student loans.

Credit Card Debt, Debt Relief, Medical Debt

How to Handle Debt in Retirement

For many Americans, including those entering retirement, being in debt is a way of life. According to numbers published by the Transamerica Center for Retirement Studies, four in every 10 retirees report getting out of debt as a top priority. Many of them are struggling to the point where bankruptcy is their only way out. In fact, the Consumer Bankruptcy Project reports that one in every seven bankruptcy filers is over the age of 65.

One of the reasons why seniors are struggling financially has to do with living on a fixed income. All it takes is for one medical crisis to strike to set them back significantly in their financial goals. The hopes of entering retirement debt free can be difficult for those carrying large amounts of credit card debt and student loan debt. It also does not help that larger companies cut back or even took away pensions for American workers who pinned their hopes of retirement on these plans.

Bankruptcy Law, Medical Debt

University of Virginia Health System Sues Patients, Putting Liens on Homes and Seizing Paychecks

Medical debt remains the leading cause of bankruptcy in America. Thousands of patients at University of Virginia Health Systems (UVA) have seen the devastating consequences of past due medical debt.

Over the course of six years ending in June 2018, the University of Virginia Health System sued former patients over 36,000 times for a sum of over $106 million. The hospital has seized wages and bank accounts of former patients and have put liens on homes and property. This information comes from a Kaiser Health News study, which reviewed UVA Health System’s court records, hospital files, and interviewed hospital officials, as well as former patients.

Bankruptcy Law, Medical Debt

What Happens When You Fail to Pay a Hospital Bill?

Countless Americans struggle to pay for their medical expenses every year. It only takes one major medical crisis to set a person back thousands of dollars. If that person does not have adequate savings for emergency expenses, it can be very easy for that medical bill to turn up past-due and fall into collections. This situation is an all-too common occurrence for many Americans.

An estimated 43 million American consumers reportedly carry some amount of unpaid medical debt. It is also reported that half of all debt listed on American consumer credit reports is from medical expenses, according to a 2014 Consumer Financial Protection Bureau (CFPB) study.