For many Tennesseans, it is medical debt that sends them into bankruptcy. While some believe most bankruptcy cases are due to debtor's poor spending habits, the truth is often far more grim. Many who think of themselves as middle class workers, often with some degree of medical insurance, can suddenly find themselves saddled with unmanageable and overwhelming medical debt.
The FINRA Investor Education Foundation reports that almost one-third of adults in Tennessee owe some medical debt, which ties the state for seventh highest rate in the county with three other states.
People may have minimal insurance or lack sufficient coverage to deal with sudden and unexpected medical debts. Many jobs in Tennessee lack healthcare insurance, and if workers are hourly, an injury or illness can leave them unable to work, meaning no income. Add to this lack of adequate medical insurance, if any and they can quickly see their bank accounts drained.
Others may gamble that they don't need heath coverage, hoping their health is sufficiently good to allow them to avoid doctors and hospitals. But once something goes wrong, they can quickly find medical debts piling up.
Sometimes the bills a large, $10,000 for a surgeon or a few days in the hospital, or they can be a few hundred dollars here and there, which can quickly add up to thousands of dollars over the course of year. These bills can become past due accounts that can damage your credit report and cause problems if you need a car loan or even a credit card.
Whether it is a massive blow or death by a thousand cuts, a bankruptcy can help resolve these debts, allowing you to receive a discharge and help your financial health recover along with your physical recovery.
The Tennessean, "Medical debt takes financial toll on Tennesseans," Holly Fletcher, January 23, 2015