Medical debt continues to be one of the most common reasons why consumers file for bankruptcy protection. Since unemployment continues to be a challenge for many Americans across the country there is a continued lack of financial support for medical insurance coverage. The same is likely for those who are underemployed. Even some with medical coverage find themselves struggling to keep up with necessary expenses when an unexpected medical emergency happens.
While many may find personal debt such as credit card bills and outstanding loans overwhelming, others may find medical debt alone to be a big problem for several reasons. Debt collectors for medical collection agencies, as well as hospitals and other medical-related businesses have become more aggressive with their collection tactics.
Consumers are facing harassing phone calls, letters and being pursued in small claims court for payment on medical bills. Once a judgment is entered the medical creditor can garnish your wages and/or bank account.
Bankruptcy is often seen as a last resort for resolving outstanding debt. The same is true for medical debt, especially when patients are unable to agree on an affordable payment plan with creditors. Having limited income makes making payments more difficult which is why bankruptcy is a good option to consider.
The filing process helps stop wage garnishment , prevents further legal action from lawsuits served and helps protect personal property from being seized to satisfy creditors. If you feel overwhelmed with outstanding debt obligations, review your situation with an experienced Georgia bankruptcy attorney to learn if bankruptcy is the best option for you.
When you or a loved one is dealing with an illness or other health concerns, the last thing you want to worry about is how bills will be paid. This is when an experienced bankruptcy attorney may be able to help you find an appropriate solution to your debt situation.
If you are dealing with medical debt or find it is becoming increasing difficult to make necessary monthly payments because of medical bills, discuss your situation with a bankruptcy expert.
Recovering from a major illness or injury often means recovery financially from mounting medical debt . Even individuals with health insurance find that medical debt is a leading cause for considering bankruptcy. Unfortunately, many debtors consider bankruptcy long after they have substantially whittled away at their limited resources and assets.
Medical Debt And Chapter 7 Bankruptcy
In Georgia, medical debt is considered “unsecured debt,” and is treated like credit card debt in bankruptcy cases. This means that if you successfully complete your Chapter 7 bankruptcy, your medical debt will be wiped out.
To qualify for Chapter 7 bankruptcy, you must first take a “means test.” Fortunately, you may not have to take the whole test. If your income over the last 6 months was below the average income in Georgia, you will automatically qualify for Chapter 7 bankruptcy.
If your income is higher than the state average, you may still qualify for Chapter 7 bankruptcy–you just have to take the entire means test. Taking the means test could be your first step to getting rid of your medical debt in Atlanta, GA.
Medical Debt And Chapter 13 Bankruptcy
If after taking the means test you find out that you don’t qualify for Chapter 7 bankruptcy. You may still be able to file Chapter 13 bankruptcy in Georgia. Chapter 13 bankruptcy allows you to consolidate all your unsecured debt and set up an affordable monthly payment plan to pay that debt off.
For most people who file Chapter 13 bankruptcy in Georgia, your creditors typically only get a fraction of what you owe. While Chapter 13 bankruptcy will not immediately discharge your medical debt, it can make it much more manageable. Chapter 13 bankruptcy in Atlanta, GA can also save you thousands of dollars.
What If You Incur More Medical Bills?
If you are still undergoing treatment or foresee continued medical expenses in the future, you may want to discuss the timing of a medical bankruptcy with your bankruptcy attorney. You may want to consider waiting to file your medical bankruptcy case until your medical treatment is completed. Or you may want to consider a Chapter 13 bankruptcy and convert to a Chapter 7 bankruptcy if ongoing medical expenses become overwhelming as debts incurred in Chapter 13 are dischargeable upon conversion to a Chapter 7 bankruptcy.
Will My Doctor Stop Treating Me If I File Bankruptcy?
Filers of medical bankruptcies are always concerned about their continued relationship with their doctors and medical providers if they discharge their medical debts. Although medical providers (with the exception of hospital emergency room treatments) can refuse to treat you after their debt has been discharged in bankruptcy, most medical providers will not deny you continued treatment if you pay ongoing bills as they are incurred.
After all, you are not the first patient to default on overwhelming medical debts in distressed circumstances and will not be the last for that medical provider. Plus most doctors realize that a debtor cannot re-file for bankruptcy for a period of time so those ongoing medical expenses are somewhat insulated from a future discharge.
If all else fails, there are plenty of other doctors and medical providers that will treat you and will not know about a past bankruptcy. Lastly, there is no law preventing you from voluntarily re-paying an old medical debt after discharge if you have the means to do so. Call or email us today for a free consultation.
We invite you to contact us either online or by phone at 404-919-7296 to schedule a free confidential consultation to review your personal financial situation and what options we can provide to protect you from creditors. For additional information about bankruptcy please also check out our YouTube Channel which has up to date vlogs on issues related to personal bankruptcy.