Is Personal Bankruptcy a Solution for Health Care Debt?
Did you know that 100 million Americans currently owe a collective $220 billion in medical debt, and many of those Americans are struggling with payments on that debt? That data comes from the Scheinman Institute at Cornell University, which also reports that about one-third of Americans — including a large portion of those currently struggling with health care-related debt — only earn wages of $15 per hour or less. With inflation and continually rising costs of living, it is becoming more and more difficult for Florida residents who have seemingly insurmountable medical debt to envision a way of ever paying off what they owe and becoming debt-free.
For many of those Floridians, personal bankruptcy could be a solution. What do you need to know? Consider the following information from our West Palm Beach bankruptcy attorneys.
Medical Debt is Usually Dischargeable
When an individual files for bankruptcy in Florida, they can receive a discharge of their debts within about four to six months in a Chapter 7 bankruptcy case. In a Chapter 13 bankruptcy case, a portion of debts must be repaid over a period of three to five years, after which time any remaining eligible debts can also be discharged. The US Bankruptcy Code identifies debts that are considered “exceptions to discharge,” meaning that they are not dischargeable in a personal bankruptcy case. For some of those exceptions, there are exceptions to the exception — in other words, some debts that are considered to be exceptions to discharge can actually be discharged in some bankruptcy proceedings.
But you do not need to consider exceptions to discharge in relation to medical or health care debt — these forms of debt are not included within any exceptions to discharge. Accordingly, medical and health care-related debt is almost always dischargeable in personal bankruptcy cases, under both Chapter 7 and Chapter 13.
Discharge Medical Debt Alongside Other Debts
If you do file for bankruptcy to eliminate medical debt, you should know that other types of debt you have may also be dischargeable. For example, if you file for bankruptcy to get a fresh start in relation to your medical debt, you may also be able to have credit card debt, personal loan debt, mortgage debt, and even student loan debt in some cases discharged.
In a Chapter 7 bankruptcy case in particular, all dischargeable debts can be wiped out within months, and you will have a fully fresh financial start in relation to your medical debt and any other dischargeable debts that you want to have eliminated.
Contact a West Palm Beach Bankruptcy Attorney Today
If you are currently struggling with medical or other health care-related debt in Florida, you are among the millions of Americans in this difficult position. While struggling to repay seemingly insurmountable medical debt can cause anxiety for individuals and within families, it is important to know that this type of debt is dischargeable in most types of consumer bankruptcy cases. By filing for Chapter 7 or Chapter 13 bankruptcy, you may be able to get rid of your medical debt in addition to other types of dischargeable debt. To find out more, contact an experienced West Palm Beach bankruptcy lawyer at Kelley, Fulton, Kaplan & Eller today.
Source:
law.cornell.edu/uscode/text/11
