While you were growing up, you probably had some sort of idea of what you wanted to be, perhaps a lawyer, a teacher, or a business owner. You went through life, preparing for that path, from graduating high school and from there moving on to college. Once you graduated college, you entered the workforce, where you took a career path that you thought was the right one for you. However, perhaps — like it so often does — life did not go the way you had planned. And now you find yourself deep in debt due to an unforeseen medical condition or hospital stay, and you are at your wit’s end.
The Law Offices of Loomis & Greene near Estes Park can help. We have an expert bankruptcy team that can offer you legal advice on your life’s circumstances. We can advise you on which type of bankruptcy would best suit you, and even if you should file bankruptcy. In this blog post, we’ll examine in general if you should file bankruptcy for your medical bills, and we’ll offer constructive advice when you do find yourself with mounting medical bills. Contact us today for a free consultation!
FILING BANKRUPTCY FOR MEDICAL DEBT
Filing bankruptcy is the same legal process no matter what the reason, and filing bankruptcy for medical bills continues to be one of the most common reasons people end up in bankruptcy court. There are many reasons for finding yourself with huge medical bills:
- Long illness
- Loss of job and thus loss of medical insurance
- Catastrophic accident, leaving you with many surgeries and physical therapy
- Chronic condition that entails expensive medications not covered by insurance
- Experimental treatments for medical conditions you underwent
- And many more
Many people find themselves in the situation where they have excellent credit except for these mounting medical bills. The Law Offices of Loomis & Greene near Estes Park often gets the question of if you can file bankruptcy for just medical bills alone. The answer is no — unless that is all the debt you have. However, the process is the same, as are the consequences. The bankruptcy court (specifically the bankruptcy trustee) will take a look at all of your nonexempt assets (some assets can be exempt, depending on which state you live in) and has the right to sell them in order to pay your debt.
A bankruptcy will include all of your debt, personal property, and real estate that you own. You will be required to report all income, all assets, and even the income and assets of your spouse, if you are filing on your own.
However, it is here where a top-notch bankruptcy attorney can be worth their price in gold. The Law Offices of Loomis & Greene near Estes Park notes that especially with medical bills, creditors can be willing to write them off in the bankruptcy process or significantly reduce them. Your bankruptcy attorney can advise you the best.
Timing is Everything
When you declare bankruptcy, you are stopping time, meaning all of the debt that you have incurred in the past from the day the bankruptcy petition is filed can be eradicated. All future debt is not in the bankruptcy, and thus you will be liable for that debt. This makes timing your medical bankruptcy crucial, especially if you are still undergoing medical treatments. For instance, cancer patients often have months of chemotherapy. While it can be hard to let the medical bills mount up, this is often necessary in order to ensure that when you do file bankruptcy, you are not left with medical debt.
Remember, you can only file bankruptcy in the United States once every eight years. Thus, you’ll want to use your filing very carefully. Consulting your superb bankruptcy attorney will be key to getting the timing down just right for your medical bankruptcy filing.
Don’t Use Credit Cards!
Many people put their medical bills on credit cards, especially when they know they can’t pay them. Some doctors and hospitals will reward patients with discounts if they pay in full up front. If the credit card company suspects that you put debt on credit cards that you knowingly couldn’t pay, they could show up to the meeting of creditors (or before) and request that your debt be classified as nonexempt, which means it may not be discharged. This could leave you with the exact debt you wanted to get rid of in the first place. The Law Offices of Loomis & Greene near Estes Park advises that if you know you cannot pay your debt, immediately begin negotiations with the medical provider. Never put medical debt on credit cards.
BEFORE MEDICAL BANKRUPTCY, TRY THIS!
Negotiate with Creditors
As mentioned above, oftentimes, medical creditors will negotiate your debt. Possible options include:
- Putting together a manageable payment plan
- Knocking money off what you owe in exchange for a lower amount
- Applying for and receiving medical assistance, especially for medically necessary procedures (Hospital Care Assurance Program (HCAP) is one provide
- See if the hospital you owe money to is a non-profit. These hospitals can offer 100% debt forgiveness, depending on your circumstances
What About My Doctor?
Many people worry about whether their doctor will get paid if they file bankruptcy (in fact, some people don’t file bankruptcy because of this very concern). A lot of people, especially older people, have a life-long relationship with their doctor, and if they have had a major illness, say cancer, they are extremely grateful for the care they have received. They don’t want their doctor to not get paid, nor do they want to jeopardize that relationship that may be decades-long.
The Law Offices of Loomis & Greene near Estes Park notes that a medical provider whom you have included in your bankruptcy has the legal right to refuse services to you after the debt you owe them has been discharged in medical bankruptcy. In reality, most providers do not take that drastic of an action, since most of them understand your need to do what is best for you. As long as they have assurance you will pay moving forward, you are usually not removed from their practice. However, do be aware that that is a possibility.
HOW THE LAW OFFICES OF LOOMIS & GREENE CAN HELP
The Law Offices of Loomis & Greene near Estes Park understands that despite your best wishes, plans often go astray, and you might end up down the path of bankruptcy. We can help. Our compassionate bankruptcy lawyer team has the knowledge and experience to advise you on which course of action you should take, and if you do choose a bankruptcy, to help you through the bankruptcy process to the end. With more than 30 years of experience in helping people with their bankruptcy needs, our bankruptcy attorneys will work diligently to get you the best outcome possible.
In addition to bankruptcy services, our legal team also can help in the areas of criminal law, divorce and family law, and landlord representation. From helping you through child custody issues to helping you with tenants, The Law Offices of Loomis & Greene near Estes Park has got all of your needs covered. Contact us today for a free consultation on all of the legal services we provide!