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Medical bills are a source of debt for millions of Americans from all walks of life. However, some cities and states are affected more than others. With Pennsylvania ranking thirteenth in the nation for highest healthcare costs per capita according to the Kaiser Family Foundation, Philadelphians are especially likely to incur medical debt. If you or a loved one is struggling financially because of hospital bills, prescription drug costs, or other medical expenditures, one solution may be filing for Chapter 7 or Chapter 13 with help from a Philadelphia bankruptcy attorney. Continue reading to learn more about how bankruptcy can help with medical debt, plus a look at some recent statistics on medical debt in the United States.

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New York Times Survey on U.S. Medical Debt Statistics

Pennsylvanians struggle with a heavy medical debt burden, but they aren’t alone. In January 2016, the Kaiser Family Foundation partnered with the New York Times to survey Americans aged 18 to 64 on healthcare costs, medical debt, and how it affected their families. Below are five of the most surprising statistics the survey revealed.

  1. As of August 2016, one in five Americans with health insurance reported difficulty paying for medical bills. Uninsured Americans had an even higher rate of medical debt, with just over half reporting that they struggled to pay their medical bills.
  2. Regardless of whether or not they had insurance coverage, about a quarter of those who reported difficulty keeping up with medical bills stated that their medical debt was less than $1,000. A higher number of people – just under one third – said that their medical bills added up to at least $5,000. Among people in this category, more than 10% reported bills of or exceeding $10,000. Averaged across the year, that amounts to a monthly bill of more than $830.
  3. Regardless of whether they were insured, about 44% to 45% of those with medical debt reported that “the bills had a major impact on their families.”
  4. Many people avoid getting the treatment or preventative care they need because they are worried about incurring too much medical debt. Nearly 30% of survey participants said they had either avoided seeking treatment, skipped a follow-up appointment, or skipped a medical test due to financial concerns.
  5. Military veterans with medical debt seem more likely than other people to be contacted or harassed by debt collectors. Data from the Consumer Financial Protection Bureau revealed that in 2015, approximately half of all complaints received from servicemembers involved debt collection.

How to Clear Medical Debt by Filing Bankruptcy in PA

If you’re losing sleep and experiencing stress over medical bills that seem impossible to pay off, you should speak with our Philadelphia Chapter 7 lawyers or Chapter 13 bankruptcy lawyers about the financial options that may be available for restructuring or reducing your payments. Personal bankruptcy could be an appropriate and effective solution for lowering or even wiping out your medical debt completely, depending on factors like:

  • How much you owe.
  • How much you earn.
  • What assets you have.
  • Whether you have additional non-medical sources of debt.
  • Your financial goals, both for the immediate future and distant future.

Depending on their income and other factors, most Pennsylvanians file either Chapter 7 bankruptcy or Chapter 13 bankruptcy. While there are many differences between these two common types of bankruptcy, both give debtors the opportunity to “discharge” or erase their medical debt. When a debt is “dischargeable” in bankruptcy, it means that the debt will continue to exist, but the filer will no longer be responsible for paying it off. In other words, bankruptcy allows the filer to wipe away medical debt and get a clean financial slate. Other dischargeable debts in bankruptcy include:

  • Credit Card Debt
  • Past-Due Rent
  • Past-Due Utility Bills
  • Personal Loans
  • Social Security Overpayments

In some cases, it is also possible to discharge:

  • Income Tax Debt
  • Student Loan Debt

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Contact Our Philadelphia Bankruptcy Lawyers for Debt Relief

Philadelphia is home to some of the best hospitals in the country, including world-renowned facilities like the Penn Presbyterian Medical Center in University City, Thomas Jefferson University Hospital in Center City, and the Children’s Hospital of Philadelphia (CHOP) in West Philadelphia. However, while Philadelphians are fortunate to have access to world-class medical care, patients often find themselves with medical bills that reach into the tens if not hundreds of thousands.

Even with excellent health insurance, these types of expenses are simply devastating for most families. The good news is that medical debt doesn’t have to cast a shadow over your financial life any longer. When managed effectively by an experienced Chapter 7 attorney in Montgomery County, bankruptcy can help you reduce what you owe, or even wipe out your medical debt completely.

To learn more about eliminating medical bills with bankruptcy in Pennsylvania, call the Montgomery County Chapter 13 attorneys of Sadek & Cooper Law Offices at (215) 995-2543. Your initial consultation is completely free of charge, and we will keep your information confidential. With Philadelphia offices conveniently located in Center City and Northeast Philadelphia, we are proud to serve the residents of Southeastern Pennsylvania, including Bucks County, Delaware County, and Montgomery County.