Discharge of Debts
It is a travesty that this still occurs in this county. But for some people, when they get sick, they suffer huge financial expenses which they cannot afford. Getting sick often leads to bankruptcy.
Even for those who have insurance that covers most of the medical expenses, if there is a significant time away from your job, a hole can be dug so deep, so quickly, that bankruptcy still becomes the only option.
In that case, a Bankruptcy can eliminate most of this debt. There are certain exceptions to the elimination of your debt in Bankruptcy. If you have incurred debt through fraudulent pretenses, then it is entirely possible that you will owe that money even after you file bankruptcy.
But for most people, they are not incurring medical expenses through fraudulent pretenses. Most people who get sick are not doing so with the intent to incur debt from their doctors so they can not pay these debts through a bankruptcy.
The way this happens for most people is they get sick. Something happens. It might be an injury at work. There might be a car accident. Or we may contract some contagious disease that knocks us down for 3 months. That is all it takes to disrupt our monthly income. If we are not fully covered by numerous insurance policies, both the medical debt and our regular consumer debt can skyrocket out of control.
While this is an unfortunate circumstance for many people facing this situation, the bankruptcy court does remain a significant tool to discharge tens of thousands of dollars in medical bills should you need this relief.
The Means Test
Medical costs come into play in other ways in someone who needs a bankruptcy. For some people, the fact that they have ongoing health care expenses can make an incredible difference in how you go through this process.
Several people with ongoing medical expenses have income. When you file bankruptcy, the court puts you through a test to see if you have too much income to file a bankruptcy without paying your creditors something. And if you have too much income, then the court goes through this process to determine how much you have to pay back.
On many occasions, the fact that a person has ongoing medical expenses creates a monthly deduction for them which helps them through these income tests the Banrkuptcy court puts you through.
It is difficult to spot some of these issues. I’ve been warned by my marketing folks not to give out too much information for fear of teaching people how to do this themselves. But just reading through this article, I am convinced that my reader will understand that should they need help navigating through the Bankruptcy system, they are going to realize that they need an attorney who can focus in on their specific situation to find these little details that can make a huge difference in their case.
Do not try to navigate Chapter 7 or the Means Test yourself without understanding how these medical debts and medical expenses can affect your case.