High Medical Bills Remain the Leading Cause of Personal Bankruptcy

By John Clark

The skyrocketing costs of medical care are expected to help push 1.7 million Americans into bankruptcy protection this year, according to a recent report from NBC News.

Sources also say that unpaid medical bills are leading cause of bankruptcy in the United States, and that having health insurance doesn?t necessarily protect consumers from medical debt.

While the number of bankruptcy filings this year will still likely be lower than the number of filings at the height of the recession, roughly 60 percent of bankruptcies will involve large amounts of medical debt, sources indicate.
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Medical Costs are Leading Factor for Bankruptcy Filers

And while high medical costs lead hundreds of thousands of Americans to file for Chapter 7 bankruptcy, they may also be impacting the health of the average patient.

According to data compiled from a broad range of federal sources, 25 million people are reluctant to take their medications in order to help lower their medical costs.

This tactic is very troubling, because delaying the use of needed medication could lead to more expensive trips to the emergency room, according to Christina LaMontagne, the vice president of NerdWallet, a foundation that studies the impact of medical debt.

In addition to the potential damage to consumers? health, high medical costs have led to risky financial behavior. This year, more than 11 million people will add credit card debt in an effort to pay medical bills, according to sources.

To add to the financial misery, more than 15 million people are expected to empty their savings in order to pay medical bills, and 10 million will have to skip a rental payment or a meal in order to pay medical bills, sources say.

Even Those Who do Not File Bankruptcy Struggle to Pay Medical Debt

Even consumers who choose not to file for bankruptcy are likely to struggle to pay their medical bills. According to sources, more than 20 percent of Americans between the ages of 19 and 64 will struggle to pay the high costs of medical treatment. This amounts to 56 million people.

To make matters worse, roughly 10 million adults who have comprehensive health insurance will still be unable to meet their medical debt obligations.

Most of the pain will be experienced by consumers with high deductible plans. ?With an average American family bringing home $50,000 in income, a high medical bill and a high-deductible insurance plan can quickly become something they are unable to pay,? said LaMontagne.

Source: http://www.clearbankruptcy.com/blog/high-medical-bills-remain-the-leading-cause-of-personal-bankruptcy/

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