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Jacksonville Bankruptcy Lawyer > Blog > Bankruptcy > Who Files For Medical Bankruptcies?

Who Files For Medical Bankruptcies?


The very poor and the very rich routinely do not have to worry about medical expenses. The very rich have money and great insurance policies. The very poor have great insurance policies provided by the state and federal governments. It’s everyone in between that suffers the fallout of increasing medical costs, higher insurance premiums, and massive deductibles. So, middle-class Americans are much more likely to face bankruptcy over medical debt than those with very large or very small resources.

Majority of all bankruptcies filed by college-educated homeowners 

Homeowners are the ones who are filing for bankruptcy, ultimately, in some cases, as a last-ditch effort to save their mortgage and keep their house. Perhaps most surprisingly, 80% of these bankruptcies were filed by individuals who had insurance at the time they got sick. In some cases, these individuals lost jobs because of their illness and were no longer covered.

Would Medicare for all fix this?

 The debate over a public option and whether or not it is the best choice for America may come to a head if Americans continue to declare bankruptcy when saddled with unexpected medical debt. One of the biggest problems for individuals in countries that operate on public insurance is getting access to services when they need it. In some cases, wait times for mental health can be quite long and unless you need emergency services, you could suffer through painful conditions while waiting your turn for surgery.

However, many Americans are forestalling having these procedures and getting mental health services because the costs are too high, essentially creating a similar set of conditions. The biggest concern over a public option is a lack of access to needed services, but in America, we’re quickly coming up on a similar set of circumstances for the majority of Americans.

Is bankruptcy the only option? 

In cases where medical providers begin to file lawsuits to recover debts, it becomes the best option to avoid the judgment. Once a creditor has a judgment against you, they can begin attempting to recover it. This means placing a lien on your real estate, garnishing your wages, or levying your bank account. So, given those potential outcomes, bankruptcy is the best option. Often, it is the only escape valve left for a family who cannot afford to pay medical expenses.

Other options include negotiating with the creditor to either reduce the debt or repay it in installments. However, the creditor must agree to the deal.

Nonetheless, the last thing a creditor wants to hear is the word “bankruptcy”. So, it gives you some leverage in negotiation. If all else fails, you can declare bankruptcy and you will have the opportunity to rehabilitate your credit. Ultimately, standards must be adjusted when there are so many people with outstanding debt.

Talk to a Jacksonville Bankruptcy Attorney Today 

The Law Offices of Carol M. Galloway helps individuals file for bankruptcy on outstanding medical debts and other debts. Call our Jacksonville bankruptcy lawyers today to schedule an appointment and we can begin discussing your next moves immediately.

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