One of the leading reasons why people seek bankruptcy protection is burdensome medical debt. With the costs of medical procedures as high as they are now, even people with health insurance can quickly become overwhelmed with medical debt. Although the treatment costs for many medical conditions can potentially lead to bankruptcy, studies have found that cancer patients are the most likely to need bankruptcy to escape the enormous medical debt.
The High Cost of Treating Cancer
Part of the reason why cancer patients are so likely to file bankruptcy is the high cost of treating the disease. Experts say that the cost of treatment has increased exponentially since the FDA approved new cancer drugs in the 1990s. Since that time, the monthly cost of treatment has ballooned from a few hundred dollars a month to about $10,000. To add to the problem, health insurance, with many plans carrying high deductibles, does not always cover the entire cost of treatment.
Many Cancer Patients Unable to Work
Another factor adding to the financial plight of cancer patients is the inability for many to hold down a job. This was the conclusion of a study by the Centers for Disease Control and Prevention. Since the disease and its treatments often prevent patients from earning a steady income, the study found that the cost of treatment can quickly overwhelm patients’ savings, forcing many to go to bankruptcy court.
Surviving Cancer Means More Debt
In a cruel twist of fate, patients that manage to survive the disease for longer periods are oftentimes rewarded with financial penury. A study by the Fred Hutchinson Cancer Research Center found that the likelihood of bankruptcy in cancer patients increased as the patient continued to live. It was found that by the fifth year of cancer treatment, cancer patients were four times more likely to file bankruptcy than those being treated for other diseases.
Cancer and Bankruptcy: Not the End of the Road
Although bankruptcy may sound like the end of the road financially, it is actually a new beginning. For those struggling with medical debts, it offers the promise of a fresh start. Medical bills are completely dischargeable in Chapter 7 bankruptcy, allowing the filer to start over anew in as few as three months.
For those that, for whatever reason, are not well suited for Chapter 7, Chapter 13 bankruptcy can also significantly help with medical debt. Although most debts in Chapter 13 are repaid over a three to five-year period under the payment plan, the majority of unsecured debts, such as medical bills, are not. As a result, medical debts, credit card bills and other unsecured debt are eliminated at the end of Chapter 13 after only a fraction (if even that) has been paid towards them.
If you are struggling with medical debts, bankruptcy may or may not be the best next step for you. The experienced bankruptcy attorneys at Minnillo Law Group Co., LPA can review your current financial situation and recommend the best way to get you back on track financially.