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Can You File for Bankruptcy to Eliminate Medical Debt?

April 1, 2019

There is a major healthcare crisis occurring in the United States. According to data collected in 2017, approximately 28.5 million Americans did not have health insurance at any point in the year. That means if any of these people suffer from a medical emergency, they could find themselves with a massive amount of medical debt.

This is one of the most common reasons why Americans need to file for bankruptcy. Medical costs continue to increase, and many people simply do not make enough money to cover the cost of these emergencies. Fortunately, it is possible to discharge medical debt with bankruptcy, so you can get your finances back on track soon.

How Do Courts Treat Medical Debt?

Your debts go into separate categories when you file for bankruptcy. Unsecured debts are ones that do not receive priority treatment, and you can eliminate them through bankruptcy. Medical debt falls into this category, along with credit card debt. The bankruptcy process lasts between four and six months, and by the end of it, you can completely get rid of any money you owe the hospital. However, you cannot get rid of certain debts. If you have student loan debt in addition to medical debt, then you can eliminate your hospital bills, but you would still need to pay off your student loans.

Will Bankruptcy Affect Future Medical Care?

A lot of people worry the doctor who helped them previously will not want to see them in the future if they discharge any debt. This is an unfounded fear. Congress passed the Emergency Medical Treatment and Active Labor Act in 1986. No hospital can refuse you care because you were unable to pay a past bill. However, doctors and primary care physicians can refuse care, but that is rare. Most understand the need to file for bankruptcy. Even if they refuse care in the future, you can always find a new primary care physician.