Although the Affordable Care Act was designed to help minimize medical costs and ensure all Americans have access to affordable insurance options, millions of Americans suffer from medical debt. Whether they have recently been diagnosed with a chronic medical condition or an unexpected accident puts them in the emergency room, medical debt can accumulate fast. 

When people in Michigan are stuck with overwhelming debt, it may seem impossible to get out from underneath the pile. Bankruptcy is an option for some, as they are able to wipe away medical expenses and start anew with a fresh financial slate. 

The facts 

A study conducted by the American Public Journal of Health found that more than 53,000 families file for bankruptcy every year due to devastating medical debt. Over a three-year period, court records showed that 66.5% of bankruptcy cases involved medical debt. Furthermore, 58.5% of cases were specifically due to medical expenses. 

From medical expenses to bankruptcy 

There are several ways that chronic medical conditions, injuries and sudden illnesses can lead to uncontrollable medical debt and possible bankruptcy. Not only are the immediate medical expenses stemming from the injury or condition a problem, but the indirect factors can also play a role. These include the following: 

  • Inability to work due to condition leads to decreased income 
  • Insurance policy may deem the condition or injury a ‘preexisting condition’ 
  • High deductible plans lead to little or no help from insurance company 
  • Interest on medical expenses can increase debt 

When patients struggle to make minimum payments, their case may be sent to collections, which can expound the debt further.