A growing number of Americans fear that a major health issue will lead to bankruptcy. As noted by the Gallop News website, one of the survey company’s recent polls showed that 50% of American adults feared a bankruptcy would result from a medical event. The July 2020 survey reflects an increase over the 45% of adults who reported similar concerns in 2019.
In addition to the rising cost of living, many Americans are also out of work. More than a quarter of the adults Gallup surveyed claimed they would need to borrow money to cover a $500 medical expense.
Medical bills can cause a financial crisis in many households
The Gallop survey showed that 15% of the respondents stated an individual living in their household could not repay a medical bill within the next year. Households with an annual income of $40,000 or less also carried unpaid medical debt four times longer than households earning at least $100,000 annually.
While two households could generate the same amount of medical debt from an illness, taking time off to recover may hold a different outcome for each one. Not all employers provide paid time off when a worker needs emergency surgery or a medical intervention.
Bankruptcy may help by discharging unpaid medical debts
Households of all income sizes may find that their medical bills can grow and become unmanageable. By filing a bankruptcy petition, an automatic stay may prevent a creditor from taking further action against a family struggling with medical debts.
Households overwhelmed by health care bills, credit card payments and personal loans may find these debts discharged through a personal bankruptcy. By acquiring a fresh financial start, an individual or family could discover there is a way to move forward after a major health issue.