Nearly 67% of all personal bankruptcies in the U.S. are related to medical bills. This shocking percentage makes medical bills the leading cause of bankruptcy. Serious medical conditions can be extremely expensive, and Americans are unable to afford the cost—even if they have health insurance.
These medical expenses are often unforeseen and can cause the individual to go further into debt. Serious medical conditions may necessitate expensive medical care and a long recovery period.
Serious illnesses may cause lost wages due to time away from work. Because the person is not able to work during this time, they may go further into debt.
How can you prevent medical debt?
Medical expenses are often unavoidable but there are steps you can take to reduce medical bills. The first step is making sure that you have comprehensive insurance that will cover the care you need.
You may want to invest in better insurance if yours does not provide the coverage you need. A higher annual premium may provide you with lower copays and more care options.
If you stay with in-network providers and get pre-authorization before coverage, your claim is more likely to be covered.
Planning ahead may help reduce medical debt. Many financial planners recommend having an emergency fund with finances to cover three to six months of expenses. If you are starting to get behind on your medical bills, work with the hospital to make a payment plan.
If you already have more medical debt than you can handle, you can file for bankruptcy. Filing for bankruptcy may relieve stress and give you a fresh start. If you have questions regarding bankruptcy, legal counsel will be able to provide clarity and help you regain financial freedom.