While medical bankruptcy is not a specific category of bankruptcy, you can still file bankruptcy for relief from medical debt. This simply means you won’t get to choose which debts are included in your bankruptcy, but your medical debts could still be covered. Let’s look at some of the implications of medical bankruptcy.
Medical Debt and Bankruptcy Are Fast Friends
Although there may be no specific type of bankruptcy dedicated to absolving medical debts, the fact remains that mounting medical costs lead many people to file bankruptcy. Combined with a reduced or limited ability to work due to injury or illness, this unfortunate situation can lead to financial ruin down the road.
It is crucial to get on top of medical bills right away without allowing them to pile up. Don’t wait until bankruptcy is the only option to address the problem.
It Affects More Than Medical Debt
Filing bankruptcy for relief with medical debts can provide help with accumulated medical costs, but these are not the only debts that will be affected. You don’t get to pick and choose which debts fall under the scope of your bankruptcy. Medical debt is only one of the categories that will be impacted, and your credit score and availability will suffer a major blow.
While filing bankruptcy can provide immediate temporary relief, the long-term impacts can be much more devastating than working out the debt through other means. This is why at CreditGUARD we stress financial education. Only through understanding the implications and future impacts of current decisions will you be able to overcome debts, whether medical or otherwise credit related.
Your Credit Score Takes a Dive
At CreditGUARD we do not recommend taking on any new credit debts while working to overcome outstanding debts. But your credit score can be a factor in other areas than just new credit cards. It can affect your ability to buy a home as well as finance a car. It can even be used as a reason to decline employment when you are searching for a job. Taking care of your credit score is a crucial part of securing your financial future. Filing for bankruptcy, even if only for medical debt, will have an enormous negative impact on your credit score.
Finding Another Way to Manage Medical Debt
Insurance is crucial to avoiding large medical debts. The lack of insurance can lead to not seeing a physician in a timely fashion. Not having insurance also leaves you responsible for any medical debt you do incur, and the bigger the emergency the more you will end up owing.
Medical insurance is expensive and should be obtained through an employer whenever possible. Even at great cost, it can still be much more cost efficient than whopping medical bills due to an emergency room visit or lengthy hospital stay.
If you are having trouble staying up to date with medical bills and other mounting credit debts, call and speak with one of our certified credit counselors today. At CreditGUARD we will work to devise a strategy for you to get back on track and focus on what’s truly important: your health!