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.
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.
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.
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.
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 (877) 891-1638. We provide affordable debt relief services to help you get a fresh financial start.
About Burr Law
Milwaukee bankruptcy lawyers Michael Burr and the experts at Burr Law Office are here to help with your bankruptcy needs. Let us help you find a solution that is right for you. Whether filing for Chapter 7 bankruptcy in Milwaukee, bankruptcy in Waukesha, or debt consolidation in Milwaukee, we have earned a reputation for being the best bankruptcy lawyers in Milwaukee, as well as experienced advocates… a resource people can call on when they need help reclaiming their power and getting a fresh start in life. With offices in Milwaukee and Elm Grove, we are the best bankruptcy attorneys in Milwaukee.