Despite the stigma surrounding bankruptcy, most people do not file because of financial irresponsibility. Usually, the reason relates to circumstances outside their control.

For example, according to CNBC, a 2019 study found that medical issues were a factor in about two-thirds of all bankruptcy filings.

How do medical issues lead to bankruptcy?

There are two ways that medical issues can lead to bankruptcy. Health care is expensive, and people who do not have insurance can incur large amounts of debt by receiving treatments needed to treat a disease or injury. Even people who have health insurance may find that it does not cover everything.

It may take a long time for a patient to recover from a severe injury or illness. He or she may not be able to work during that time. If this is the case, the patient may fall behind on other bills while the medical expenses keep mounting at the same time.

What effect has the Affordable Care Act had?

The Affordable Care Act was a landmark piece of legislation that made health insurance accessible to people who would not be able to afford it otherwise. However, government stipends that make it possible to purchase a policy may not be enough to cover the most comprehensive plans. The policy that a person can afford may have limitations to its coverage. Unfortunately, there has actually been a slight increase in the number of people who have filed for bankruptcy at least partially for medical reasons, though this could relate to factors other than the ACA.

Other common reasons for bankruptcy include separation or divorce, student loans and unaffordable mortgages.