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Even after the ACA, many Americans face steep medical bills and debt

The rising cost of medical care and related expenses, such as deductibles, may leave many people in Louisiana facing growing debt.

Medical expenses are often costly, unexpected and largely uncontrollable. As a result, these expenses can prove financially burdensome or even crippling for many people in Haughton. Not surprisingly, medical debt was identified as a leading cause of American bankruptcies in 2013, according to CNBC News.

The enhanced availability of healthcare coverage under the Affordable Care Act has helped reduce the number of Americans who struggle to pay medical bills. Still, as CBS News reports, about 23 percent of Americans still have trouble keeping up with these costs. As of December 2014, outstanding medical debt affected 43 million Americans. Unfortunately, this trend may continue as insured consumers take on a greater share of medical costs.

Ongoing cost changes

Part of the growing burden of medical expenses may come from increases in health insurance deductibles. In January 2015, USA Today reported the following findings on deductible cost changes:

  • In the last eight years, the average deductible has more than doubled, reaching a total value of $1,217.
  • Over the same period, the number of consumers required to pay deductibles also grew, from 55 percent to 80 percent.
  • In 2014, the number of employees enrolled in high-deductible plans jumped more than 25 percent. Now, more than one in five employees are enrolled in these plans.

These costs may be especially burdensome because various expenses, including co-pays and unapproved procedures, don't count toward these deductibles.

Overwhelming expenses

Research indicates that many Americans simply don't have the resources to meet these financial demands. USA Today notes that the average American's savings consist of less than $6,000. Yearly deductible costs for families, which average around $10,000, may easily outstrip these savings.

Medical expenses have even become steep enough to deter many people from seeking care. One survey found that high costs have caused about 40 percent of adults to forgo some kind of needed medical attention. Unfortunately, this can worsen financial issues in the long run, as preventative care is almost always more affordable than emergency care.

Due to these factors, many people in Louisiana may face an accelerating cycle of medical debt that they are relatively powerless to break. For some of these people, filing bankruptcy may offer relief from this ongoing and overwhelming debt.

Debt discharge

Medical debt may be eligible for discharge through Chapter 7 or Chapter 13 bankruptcy. In Chapter 7 bankruptcy, a consumer's assets are liquidated to pay off outstanding debt. Liabilities that remain afterward may be discharged. In Chapter 13 bankruptcy, a consumer can enter a repayment plan and keep personal assets while completing the plan. Medical debt that is not paid off through the plan may qualify for discharge afterward.

Anyone who is seriously considering filing bankruptcy as a means of relief from medical or other debt should consider meeting with a bankruptcy lawyer. A lawyer may be able to help a person determine whether filing bankruptcy is the optimal choice. An attorney also may be able to assist a person in identifying the most favorable chapter for the situation.

Keywords: bankruptcy, medical, debt, Chapter 7, Chapter 13

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