We’ve written a series of blog posts answering common questions regarding medical bill bankruptcy in Wisconsin. Call (262) 827-0375

Medical Debt During a Pandemic

For many Americans, COVID-19 has been a perfect financial storm. Lockdowns have cost income and opportunity, and some who had been climbing out of the hole financially have had to rely on credit to get them through as the federal government has been unable to reach an accord on extending benefits. At the end of the year, a moratorium on foreclosures and evictions concludes, even as political uncertainty clouds the prospects of economic recovery. Other suspensions of debt payment, including student loan payments, are also coming to a close.

For Americans struggling with medical debt, health issues, and often depression, exacerbated by isolation and deferral of scheduled health maintenance during the pandemic, this combination of factors has added up to the perfect storm. If you’re one of those who has had to be hospitalized for treatment for COVID-19, its impact on your financial well-being may have been almost as severe as on your health. According to statistics, the median hospital stay for CoVid patients who have survived has been from 10 to 13 days. Even if you have insurance, high deductibles may have cast you deep into debt.

State departments of insurance have been working closely with medical facilities to provide some relief, but mitigation efforts vary widely depending on the hospitals and the insurers. For the uninsured, the CARES Act is supposed to cover the costs. If your hospital takes money from the CARES Act Providers Relief Fund for your treatment, they are barred by law from seeking any further compensation. But not every hospital will attempt to take what is offered by the Fund. Some will prefer to attempt to recover more money for treatment by billing the patient directly, without regard to whether they have the means to cover the bill or not. If they don’t seek payment from the government, then the patient is liable for the debt.

People who are recovering from serious illness often lack the psychic resources to aggressively defend their financial interests. Often, particularly under present circumstances, they push it off until that future date when they feel more capable of dealing with unpleasant circumstances, and that is perfectly understandable. But a word of advice: When the new year arrives, and a lot of people who have been able to put off the unpleasantness of dealing with their debt suddenly find themselves on the receiving end of legal notices, or suddenly find their bank accounts seized or their wages garnished, there will be an avalanche of filings for bankruptcy. It is best, if that seems your best avenue to get out from under crippling debt obligations, to file as soon as possible.

You can be sure that lenders who have been put off will flood the courts with new filings. In the meanwhile, many of them have been busy trying to get out in front of matters, since most kinds of consumer debt collection have not been affected, though it takes time for filings to move through already burdened courts. You can also be sure that there will be an avalanche of bankruptcy filings at that time. The experts at Burr Law can help you make the decisions that will discharge your obligations with as little pain and loss to you as possible, and get you on your way to economic recovery as quickly as may be, whether that involves filing under Chapter 7 or Chapter 13.

Do yourself a favor, and call the experts at Burr Law. They will lay things out simply for you and help you make the decisions that will put you in position to get the Debt Monster off your back, so you can begin to breathe freely again.

You are not alone. Give Burr Law a call.

Spotlight on Medical Bills as the Leading Cause of Bankruptcy in the U.S.

Bankruptcy is often a last resort for people who have experienced major unplanned financial hardships. In the United States, the five leading causes of bankruptcy are medical expenses, job loss, poor use of credit, divorce or separation, and unexpected expenses such as property loss through a natural disaster. Read on to learn more about why medical bills top this list.

Majority of Personal Bankruptcies

In a study of 2007 bankruptcy filings, medical problems were found to have caused 62 percent of all personal bankruptcies. Of those who filed, more than 75 percent had medical insurance when their illness began.

Cost of Medical Expenses

In the same study, researchers looked at the average out-of-pocket expense for those who filed personal bankruptcy. For those with private insurance, the average medically bankrupt family was out almost $18,000. Families who were uninsured saw an average medical bill of nearly $27,000.

Most Expensive Illnesses

The study found that individuals with diabetes and neurological illnesses, such as multiple sclerosis, had the highest costs of those who filed. For half of the families in the study, hospital bills were the largest single expense.

Link to Bankruptcy

Being uninsured or underinsured is a big problem for many American families. When faced with expensive medical bills, many people will be forced to mortgage their homes, leave their jobs, and use credit cards. In another study in 2007, researchers looked at low- and middle-income households with credit card debt. In these households, 29 percent of families had used their cards to pay off medical expenses.

Have you experienced a major financial upset? Bankruptcy may be the best option for your situation. To speak with a Milwaukee bankruptcy lawyer, call the Burr Law Office at (262) 827-0375. We provide affordable debt relief services to help you get a fresh financial start.

Common Reasons Why Seniors File for Bankruptcy

Between 1991 and 2007, the number of Americans age 65 and older who filed for bankruptcy more than tripled. Today, senior citizens are the fastest growing group of adults to initiate Chapter 13 and Chapter 7 filings. Here are some of the reasons why older Americans have found themselves overwhelmed by their expenses.

Medical Bills

Major medical expenses can be hard on anyone’s pocketbook, but aging men and women often face additional health concerns. If a senior citizen doesn’t have health insurance, even doctor’s checkups can quickly become unaffordable. Sadly, without proper medical attention, illnesses that go untreated can quickly develop into serious or even chronic conditions. Seniors who must pay thousands of dollars to physicians, hospitals, and specialists are often faced with bankruptcy.

Credit Card Debt

Elderly Americans most often file for the same reason as their younger counterparts: credit card debt. In fact, approximately two-thirds of debtors age 65 and older cite overwhelming credit card debt, interest, and fees as their primary reason for declaring Chapter 13 or Chapter 7. Experts have found that seniors are more likely to feel embarrassed about their mounting bills and frequently simply take out more credit cards to avoid their inevitable financial problems. But when they fail to make minimum credit card payments, filing is usually the only option available.

Inadequate Preparation

If you have been neglecting your nest egg for more pressing financial obligations, you are not alone. Thousands of elderly Americans report being late on rent or mortgage payments, and many even go without required medication or food in an effort to pay off mounting debts. Unfortunately, returning to the workforce is simply not an option for some seniors who failed to anticipate the economic downturn.

Whether you are drowning in medical debt or face insurmountable credit card fees, you have legal options. To speak to a Milwaukee bankruptcy attorney about whether filing may be your best option, call Burr Law Office at (262) 827-0375 to schedule a free consultation today.

See also “Top 5 Reasons People File for Bankruptcy

Medical Debt Bankruptcy can eliminate Medical Bills

Medical Bill Debt, Bankruptcy and Your Options

Medical debt is a crippling issue for Wisconsin, and there’s no telling how it might harm communities. Medical bill bankruptcy is a serious issue that can be hard to anticipate. Despite your best efforts, you may fall into irrecoverable debt and need help.

Current Affairs in Wisconsin

Wisconsin isn’t the most debt-ridden state, but that doesn’t mean people aren’t suffering. For instance, although one study showed that the South was the most debt-burdened, the same data also revealed that Milwaukee County was among the nation’s leaders in bankruptcy filings.

It’s also worth noting that Wisconsin may be home to especially vulnerable populations. Thanks to steady poverty rates and other factors, people who incur high medical debts could face other hardships as a result. For instance, a low-income individual who experienced a severe accident might see their credit score fall because they couldn’t afford the bill.

The Scope of Medical Debt

This problem might not be such a dire issue if people’s finances weren’t already precariously risky. With the total U.S. consumer debt blasting past $13 trillion by late 2017, Americans took on more credit card, vehicle, mortgage and education liabilities.

Wisconsinites are no different than their neighbors in other states. For the typical household with thousands of dollars in existing debts, unexpected medical debt might be the last straw.

Why Is Medical Bill Bankruptcy a Possible Solution

Medical debt is a form of unsecured debt. In other words, they’re debts that you take on without having to put up any collateral.

Bankruptcy law is designed to relieve consumers who can’t pay their debts. The rules clearly define which kinds of obligations are excusable and which aren’t. When it comes to unsecured debts, things like student loans and child support can’t be discharged, or excused. Fortunately, there’s no such limitation on medical bills.

Specific Rules to Bear in Mind

Can you discharge all of your medical debts by filing for bankruptcy? There are a few things to consider first.

Two common bankruptcy types are Chapter 7, or restructuring, and Chapter 13, or reorganization. Each kind of filing resolves the debt in its own way, and there are restrictions on who can use which option.

total limit of $394,725

  • In a Chapter 13 filing, you’ll try to come up with a repayment plan that works for both you and your creditors. Although unsecured debts are excusable, they all get lumped together, and there’s a total limit of $394,725.

pass a means test to qualify

  • With Chapter 7, you’ll have a bankruptcy trustee sell some of your property to satisfy your creditors. It doesn’t matter how much unsecured debt you owe, but you need to pass a means test to qualify.

Is filing for a Wisconsin bankruptcy right for you? Contact us at (262) 827-0375 to get the advice of an experienced Wisconsin bankruptcy attorney. If you have significant medical debts, it could be the wisest move.

How Medical Bills Became the Leading Cause of Bankruptcy

Consumers who are struggling under a mountain of debt often turn to bankruptcy as the last viable solution to help them get a fresh financial start. While a wide range of factors can contribute to bankruptcy—including student loan debt, poor investments, divorce, job loss, and other unforeseen circumstances—medical debt is the clear leader when it comes to Chapter 13 and Chapter 7 relief. Read on to better understand why medical bills so often lead to bankruptcy.

Economic Downturn

If you have recently taken a financial hit, you are not alone. The crisis in the home mortgage market coupled with the recession has left millions of Americans out of work or underemployed. While thousands of medical bankruptcies are filed by men and women who lack health insurance, the vast majority of Chapter 13 or Chapter 7 bankruptcies relating to medical debt are actually obtained by patients who had health insurance at the time of illness or injury and simply lacked the extra money to pay.

Excessive Bills

Why is it so difficult to pay for medical expenses even with health insurance? Not only are Americans low on cash, but medical bills can also quickly pile up. Individuals who are diagnosed with painful injuries and chronic illnesses require lifelong medicine and doctor’s care, while others suffer sudden and tragic accidents that lead to thousands of dollars in expenses. On average, medically bankrupt families have nearly $18,000 in out-of-pocket costs.

Income Loss

Unfortunately, falling ill or being hurt in an accident all too often translates into missed work. Some patients are never able to return to their jobs at all, while others must make do with part-time work. Without an income, bankruptcy is the only solution.

It is possible to declare bankruptcy and move on with your life. At Burr Law Office, our attorneys we provide Milwaukee affordable bankruptcy and debt relief services to help eliminate or consolidate your debts, and we understand your situation. We have helped countless clients find relief with Chapter 13 or Chapter 7. Call (877) 891-1638 to discuss your filing options with an experienced Milwaukee bankruptcy attorney.