Debt for medical bills is more common than you think and can become a real headache if not taken on time. Much more money is spent on health care in the United States than anywhere else in the world, which is a significant investment, especially when an illness or injury strikes unexpectedly.
This can affect the entire population, whether or not they have health coverage. In this sense, if there is no insurance, the expenses for medicines, for surgical treatments or for any medical procedure accumulate, putting the person in debt.
But it’s true that those with insurance can also find themselves stuck with high insurance copays, so pay close attention to avoid debt and future bankruptcy on medical bills.
In this way, in today’s post we will talk about the bankruptcy process in medical bills. We will explain what the available options are and how to carry out this procedure, hand in hand with the advice of the best professionals in the area.
Options for filing bankruptcy for medical bills
When talking about a bankruptcy for medical bills, it is important to clarify that it is not a real type of bankruptcy, but rather refers to the main source of debt for which a person files in this state.
In this way, there is no way to choose the types of debt to start a bankruptcy process, but there are different options that help to declare bankruptcy for medical bills, although they will include other categories of debt.
In this sense, there are different types of bankruptcy, but the most appropriate for medical cases are: chapter 7 (liquidation) and chapter 13 (debt adjustment). Below we detail more about each of them.
Chapter 7 or liquidation
Chapter 7 bankruptcy or also called liquidation, is the most suitable for individuals or companies, since it is the simplest form of bankruptcy. This means that liquid assets that are not exempt, such as private properties, can be freely sold and the profits received will be used to pay off the debt.
In this way, here it is possible to pay off all or part of the debt that is related to different aspects of daily life, such as credit cards, health, public services and education, among others.
This is why, when debt for medical bills exceeds income and payment possibilities, resorting to Chapter 7 bankruptcy is the best option to start from scratch.
Chapter 13 or debt adjustment
In the case of chapter 13 bankruptcy or settlement of accounts, it is another of the convenient bankruptcy options to settle the debt for medical bills. In a nutshell, this is about full debt restructuring rather than just paying off.
This means that the person can keep most of their personal property and continue working, while paying what is owed. Thus, this bankruptcy covers most debts, including medical bills, while keeping assets.
To begin the proceedings and file for Chapter 13 bankruptcy, you need to work out a payment plan that must be approved by the court. Once admitted, regular payments must be made for a period of between 3 and 5 years.
Once this proceeding is concluded, the bankruptcy trustee will discharge the entire debt, paying off any outstanding debt.
Having a health care debt can be overwhelming, especially if you find yourself in a situation of bullying or harassment. But, at the end of today’s post, we have talked about the most convenient options to avoid repossessions, evictions or any other type of summons.
Knowing about the possibilities of a bankruptcy for medical bills is very important when acting and making a decision, since it is about the future of your finances.
For this reason it is that advice from professionals in the area, such as Michael J. Brooks, bankruptcy attorney in Miami, is a fundamental piece in the process since he can attend to your legal needs, explain step by step and represent you to whom it is necessary. You know, in order to take the first step and start a bankruptcy process, safely, it is best to contact a lawyer who can advise you on your legal situation and on the possibilities you have to arrive in good terms. to an array.