CALL NOW!
FREE PHONE/VIRTUAL CONSULTATION

What is the Real Reason People are Filing for Bankruptcy?

Why People File For Bankruptcy.Can Filing for Bankruptcy Help You with Unpaid Medical Bills?

One of the most common misconceptions about bankruptcy is that everyone who files was irresponsible with money. Of course, there are people who file for bankruptcy because they mishandled credit cards, spent more than they earned, or failed to budget as needed. There are also those who are overwhelmed with medical bills.

The truth is most people who turn to bankruptcy due to circumstances entirely out of their control. Some of them lost their jobs and were out of work for an extended period. Some had to deal with a failed marriage that led them down a road of financial ruin. An even greater number faced an illness or injury that led to massive medical debt and no way to pay it off.

Why are People Really Filing for Bankruptcy?

The real reason people are filing for bankruptcy, in most cases, is because of medical bills.

Statistics show approximately two-thirds of people filing for bankruptcy do so because a medical issue contributed to serious financial problems.

Their reason for needing bankruptcy was out of their hands and in some cases, was a life or death matter. In many cases, health insurance wasn’t enough to cover the cost of their care. More than half a million Americans turn to bankruptcy every year to help them deal with medical debt.

In addition to the high cost of medical care, many people with a serious illness or injury can’t work. Not only are they racking up debt related to their medical care, but they also have no income allowing them to keep up with their medical bills.

Affordable Care Act

You might be wondering if the Affordable Care Act has done anything to help with the burden of medical care costs.

It seems not to be the case, at least according to most data.

One study published in the American Journal of Public Health showed there’s been no decrease in people filing for bankruptcy based on medical bills despite the access to coverage provided by the ACA. As a matter of fact, the number of people filing due to medical debt actually increased since the adoption of the law.

Many in the medical industry believe this is because there is still not enough adequate healthcare insurance. People have coverage, but it’s not enough coverage to help them with a catastrophic illness. Insurance coverage might be affordable, but what you’re paying for each month isn’t enough. This is especially true if you endure a catastrophic health problem. The same is true with employer-provided health insurance.

Most Americans just aren’t adequately covered and when they are faced with a serious and expensive health crisis, they’re going to be responsible for a significant amount of their healthcare costs. Making matters worse, the average American family doesn’t have enough saved. They can’t pay for a simple emergency, let alone tens of thousands of dollars in unexpected medical costs.

Changing How You Think about Health Insurance and Medical Bills

There are efforts underway to implement a Medicare for All program. This would result in broader insurance coverage for Americans, but it hasn’t happened yet.

In the meantime, people who want to avoid bankruptcy related to medical issues should understand that their health insurance is only partial coverage. They should think about a plan for how they’ll handle the unthinkable. That’s asking a lot, though, especially when so many families are living paycheck to paycheck.

If you’re concerned about mounting medical debt or you’ve reached the end of you’re facing ongoing financial issues related to the cost of medical care, bankruptcy might be able to help. Contact the Law Office of Robert M. Geller at 813-254-5696 to learn more.

Archive

Video Testimonials

Tampa Bankruptcy Law Blog

5 Questions You Should Ask Before Filing for Bankruptcy

If you're considering filing for bankruptcy, it's important to know what you're getting into. What questions should you ask before...
Read More

Top 5 Reasons to File for Bankruptcy

What are the most common reasons to file for bankruptcy? There are many valid reasons for filing for bankruptcy. According...
Read More

5 Lessons Learned from Filing for Bankruptcy and How to Avoid the Biggest Financial Mistakes

People struggling with the biggest financial mistakes often consider filing for bankruptcy. Bankruptcy can provide relief from overwhelming debt. However,...
Read More

Things to Bring Along to Your Bankruptcy Consultation

Are you considering filing for bankruptcy? If so, one of the most important steps is to consult with an attorney...
Read More

Do You Need a Chapter 7 Bankruptcy Document Checklist? 3 Things You Need to Know

Filing for bankruptcy requires organization. A chapter 7 bankruptcy document checklist can make the process easier. No one ever plans...
Read More

Will a Bankruptcy Document Preparer Save Me Money?

While it may seem like hiring a bankruptcy document preparer will save you money in the short term, this is...
Read More

Robert Geller Shares Advice for People Considering Mortgage-Modification Programs

Robert Geller’s co-authored article “Can Debtors Afford Mortgage-Modification Programs?” was recently featured in the fall 2022 edition of the Consumer...
Read More

8 Things Clients MUST Tell Their Bankruptcy Attorneys in Tampa, Florida

If you are considering filing for bankruptcy, you must find a reputable bankruptcy attorney to help you through the process....
Read More

What Happens After I File for Bankruptcy?

Filing for bankruptcy is a process that comes with a lot of paperwork, stress, and financial strain. But what happens...
Read More

What are the Most Common Bankruptcy Questions to Ask?

Considering bankruptcy can be a difficult and emotional decision. What are the bankruptcy questions to ask? To help you make...
Read More

Bankruptcy

For The Next 5 Days GET A FREE BOOK About Bankruptcy

Learn More

Infographics

We are A Debt Relief Agency.
We help people file for bankruptcy under the Bankruptcy Code

Pay Online Bankruptcy Courses Newsletter Subscription

Call For A Free Initial Consultation

813.254.5696

Tampa Office

Law Offices of Robert M. Geller, P.A.
807 West Azeele Street
Tampa, FL 33606
T: (813) 254-5696
T: (800) 853-7549
F: (813) 253-3405

Map And Directions

St. Petersburg Office

Law Offices of Robert M. Geller, P.A.
125 5th Street South
(Wells Fargo Financial Center)
2nd Floor, Suite G
St. Petersburg, FL 33701
T: (727) 532-3939

Map And Directions

Pasco Office

23526 State Road 54
Lutz, FL 33559
T: (813) 336-2320

Map And Directions