Affordable Care Act will help reduce medical bankruptcies

Affordable Care Act will help reduce medical bankruptcies

In 2014, the provision of the Affordable Care Act allowing
everyone in the U.S. access to health insurance plans through the
Health Insurance Marketplace went into effect. These health
insurance programs are designed to be affordable and limit people’
total annual health care expenses. One of the many eventual
benefits of the ACA is that fewer people will be crushed by
overwhelming medical expenses; and therefore, less of a need to
file for bankruptcy.

Bankruptcy can be very beneficial and a need may even still
arise with coverage under the ACA; however, the more we can do to
lessen the dramatic effect that medical bills can have on one’s
life, the better. Insurance is so important and much easier to
handle than hundreds of thousands in medical bills. So, it is
important to protect oneself against the threat of medical debt and
to take active steps in doing so. Bankruptcy is a wonderful tool
for those in debt but do not force yourself to file for medical
reasons when it can be prevented.

Medical bills are a leading cause of
bankruptcy


Medical debt
is a serious problem in the U.S. A 2013 study
conducted by NerdWallet Health, the division of the
price-comparison website NerdWallet that focuses on health care
costs, found that medical debt was the reason for three out of five
bankruptcies, making it the leading cause of bankruptcy among
individuals. The study also estimated that approximately 2 million
people filed for bankruptcy because of medical debts in 2013.

Many people who lack health insurance are one serious illness
away from a financial crisis. People who have been ill and racked
up large medical bills often end up maxing out their
credit cards
, emptying savings accounts and even refinancing
homes. While not everyone who has serious medical debt seeks
bankruptcy protection, the NerdWallet study reported that over 35
million people in the U.S. were contacted by collections agencies
because of medical bills. Moreover, 10 million adults had to forego
necessities like heat, rent and food just to make installment
payments on medical bills.

Reducing exposure to medical bills

The ACA will help stem the tide of medical debt bankruptcies.
The health insurance programs available on the Health Insurance
Marketplace provide more comprehensive coverage than many
minimal-coverage health insurance programs available prior to the
ACA. That means that more services are covered under these plans,
so people end up paying less out-of-pocket. People are eligible for
tax credits, as well, to help defray the cost of monthly health
insurance premium costs.

Additionally, the ACA limits the out-of-pocket expenses that a
person pays in one year to $6,250. While $6,250 may be difficult
for many people to pay in a year, it is more manageable than the
hundreds of thousands of dollars in medical debt that an uninsured
or underinsured person can accrue from cancer treatment, for
example.

Talk to a lawyer

While the ACA should help people from needing to file bankruptcy
because of medical debt in the future, it does nothing for those
who have already amassed huge medical bills. Those with serious
medical debt may want to consider bankruptcy as a means of debt
relief. If you have questions about your options for dealing with
medical bills, speak with a skilled debt relief attorney who can
advise you on how to proceed based on your specific
circumstances.

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Affordable Care Act will help reduce medical bankruptcies