The cost of medical services in America is at ridiculous levels. The current rates for medical care are extremely high and only seem to be increasing each and every year going into the future. It is estimated that over 500,000 Americans file for bankruptcy each year due to medical debts. Even President Obama mentioned in his 2009 State of the Union address, that a medical bankruptcy occurs approximately every 30 seconds in the United States. This is a staggering number and it seems that this situation is not getting better anytime soon. We at The Weller Legal Group want to discuss throughout this article how medical bills are connected with bankruptcy and how you may be able to take care of your current financial situation.
The Hard Truth
The majority of Americans in the United States are living paycheck to paycheck. This means that if they lose their job today, they could very well be homeless the next month. A recent study from a website called Bankrate, uncovered through research that only 40 percent of United States citizens have enough in their savings to cover a $1,000 emergency expense that they would have to pay. This statistic is quite unsettling and really sheds some light on how many Americans are really living. Many Americans do have health insurance that can help with the medical bills, but with some deductibles being as high as $5,000 or even higher in some cases, it can be almost impossible for the average American to come up with that kind of money. This is where a lot of Americans are starting to get into trouble and can be enslaved to a massive medical debt that they may have to come out of pocket for.
Average Medical Spending
It is estimated that in 2017 the average American spends about $10,739 per year on healthcare. If we look at the average salary in America of $56,516 before taxes, we can see that a large majority of American’s income goes towards healthcare costs. If we look at some research from Business Insider, it looks like the number 1 cause of people to file for personal bankruptcy in America is because of overwhelming medical debt, followed by unaffordable mortgages, and spending above one’s means which comes in third place. Another debt that was featured on the list was student loans but unfortunately student loans are not able to be discharged with a bankruptcy.
Medical Debt Options
If you have overwhelming medical debt then it may be time to look into filing for bankruptcy protection. It is important to discuss with your prospective attorney if bankruptcy is the right option for you and your family. The two most common forms of bankruptcy in America are Chapter 7 Bankruptcy and Chapter 13 Bankruptcy. With a Chapter 7 Bankruptcy you are trying to discharge as much of your unsecured debt as possible so that you can give yourself a fresh new beginning. Chapter 7 Bankruptcy may be a good option for you if your current medical debts are very high and your income is quite low. One downside that you must keep in mind is that if you file for Chapter 7 Bankruptcy you may be forced to sell your home to help pay off some of your outstanding debts. In regards to Chapter 13 Bankruptcy, this type of bankruptcy may be good for someone who is a high-income earner who has a lot of assets. With this type of bankruptcy, you are usually trying to negotiate a type of repayment plan to pay back your debt over time. This type of bankruptcy may be able to get you to pay a lower amount then you originally owed and possibly a lower interest rate and monthly payment. The payments that you will be making will usually be in plans of 3 to 5-year repayment plans. After your repayment plan is finish all remaining dischargeable debts will be discharged. It is important that you discuss with your attorney which option would be the best for your current financial situation.
The healthcare industry is a multi-trillion-dollar industry. They do not bring in record number profits by being cheap and supporting the “little guy.” The majority of healthcare plans are structured to squeeze as much as they can out of their clients. Basic medicine, hospital care, and supplies have ridiculous mark ups in price. For example, it is pretty normal for a hospital to buy IV bags for only $1 to $5 per bag. With that being said when the bill comes up for the client it can show up as a $100 to $500 bill per bag. As we can see this is only one example of how the medical industry is really hurting the middle class. The future is uncertain for how the medical industry will go. One thing that we do know today is that the medical industry is really hurting the American middle class. As we mentioned earlier in this article, medical debts are the number 1 reason for Americans to file for bankruptcy. It is estimated that approximately 66% of all personal bankruptcies filed in the United States is because of overwhelming medical debts.
We at The Weller Legal Group hope that the information provided to you in this article was informational in helping you understand how flawed the medical industry is in the United States. It is sad that so many hard-working Americans have to deal with overwhelming medical bills that cause their lives so much stress. If you are dealing with your own personal medical bills and you don’t think you can pay your debts back make sure to give us a call today. We at The Weller Legal Group have over 20 years of experience in helping our clients with their bankruptcies and working on improving their credit scores. We have offices located all throughout Florida, including, Clearwater, Port Richey, and Lakeland. If you have any other questions in regards to filing bankruptcies or working on improving your credit score feel free to give us a call today at 1-800-407-3328.
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