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Medical debt often drives people to file for bankruptcy

Medical bills present serious financial challenges to many Kentucky residents. Although people can cut corners on living expenses and try to build their savings, these efforts could prove insufficient in the face of mounting medical expenses. Even individuals with health insurance can struggle to cover copays and deductibles. At some point, bankruptcy emerges as a viable option for those recovering from impossible-to-pay bills.

Bankruptcy, however, saddles people with a bad credit history for 10 years. This impacts a debtor's ability to rent an apartment, qualify for a loan or land a new job. Filing for bankruptcy incurs legal costs on people as well, but sometimes insurmountable medical debt makes the move worthwhile.

Health care bills represent the leading source of personal bankruptcies, according to the Kaiser Family Foundation. A recent report revealed that among people under age 65 with health insurance, 20 percent of them still fell behind on medical bills. The majority of those people had already depleted their savings trying to stay out of debt, and nearly half of them, 42 percent, worked an extra job because of medical costs.

When a person needs more information about relief from medical debt, an attorney who practices bankruptcy law could provide personal advice. A lawyer could analyze the client's income and debts to see if the situation could qualify for a bankruptcy action. Information about how to protect a home might also be provided by an attorney. To go forward with the bankruptcy, an attorney could prepare the court paperwork and take over communications with creditors. In court, the attorney might explain the client's financial problems and take action to protect the client's rights when creditors make claims upon assets.

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