A national study recently published in The American Journal of Medicine reveals that medical expenses caused or contributed to 62% of all bankruptcy cases filed in 2007. This is a 50% increase from 2001. While this is no surprise to bankruptcy lawyers, we see the financial devastation caused by the expense of illness and hospital bills every day, the statistics that came out of the results of the study were a surprise.
The majority of people with medical expenses who filed for bankruptcy were middle class, owned a home and had some college education. The average age was 44 years old, and about half were married. Three-quarters of those individuals had health insurance!
High medical bills directly contributed to individuals filing for bankruptcy, even with continuous health insurance coverage. Families with coverage were under insured and ultimately responsible for thousands of dollars in expenses and drug costs that were not covered by insurance. Many families who were struggling to pay the medical expenses were forced into bankruptcy by the aggressive collection tactics of medical debt collectors.
Many of the individuals in the study had lost income due to illness and had used credit cards and even mortgaged their home to pay on the medical bills and drug expenses.
The study concluded that the US health care financing system is broken and families are collapsing under a health care system that “treats physical wounds, but often inflicts fiscal ones.”
Disclaimer: This blog is intended as general information purposes only, and is not a substitute for legal advice. Anyone with a legal problem should consult a lawyer immediately.