Is medical debt the new cause of financial distress for Americans?
Medical debt is the top reason people file for bankruptcy, above credit card debt and other problems. Those with insurance can also have financial problems.
A financial emergency can cause devastating problems for South Carolina residents. This type of situation may be due to credit card debt or an unexpected job loss. Medical debt is another common reason for people to experience monetary distress; in fact, financial experts say that medical bills are quickly overtaking credit card debt, mortgage problems and other issues as the top cause of personal bankruptcy filings across the country.
According to CNBC, medical reasons factor in about three-fifths of personal bankruptcies, affecting about 2 million people in 2013. Overwhelming medical costs currently affect over 20 percent of Americans.
Other financial challenges related to medical issues
Insurmountable hospital bills are not the only thing to financially cripple so many people across the country. According to Fox Business, there are numerous other factors related to the medical field that can result in monetary problems, including the following:
- Co-payments, medication and other costs not covered by insurance
- Lost wages due to unemployment or reduced hours resulting from a medical condition
- Travel and housing expenses related to medical treatment
Additionally, a long-term illness or sudden medical emergency can trigger a landslide of related financial difficulties. For example, a cancer patient might have to max out his or her credit cards to cover utility bills and other living expenses. Patients who need to be on medication might be forced to cut back on the medicine they need if they are uninsured or the drugs are not covered by their insurance, which could result in additional health problems over time. For many people, one single medical emergency could end up draining their savings accounts. Many are unable to pay for basic necessities, including rent, utility bills and food.
Having health insurance does not necessarily prevent problems
It might be assumed that only those without medical insurance experience the majority of these issues. However, this is far from the case. Out of those with overwhelming medical-related bills, 78 percent of them have insurance. However, as stated above, health insurance does not always fully cover treatment or related costs.
If you are experiencing insurmountable financial problems due to medical bills, you will need help to get out of this situation. One of your options is filing for bankruptcy, which may wipe the slate clean or allow you to restructure your debt in a manageable way. It can be wise to speak with an experienced bankruptcy attorney in Charleston to discuss your options.