Medical Debt Pushing Many Oregonians to the Financial Brink

December 13, 2012

Getting diagnosed with cancer or another serious illness is one of the scariest things most people will ever experience. Of course, the most pressing concern is often one of life or death. But after the initial shock wears off and a treatment plan is created, many people in Oregon find themselves facing a different, yet equally troubling prospect: how on earth will they handle all the bills?

Serious illness or injury is one of the most common reasons people file for bankruptcy, both in Oregon and throughout the United States. According to data published by the New York Times, approximately 20 percent of people who entered into bankruptcy in 2010 and 2011 listed medical debt as the primary cause of their financial problems. This number is up significantly since the start of the recession.

The expenses associated with a major illness are staggering. As an example, according to the Healthcare Blue Book, treatment for breast cancer can easily top $25,000 once diagnostics, surgery, chemotherapy and radiation are all taken into account.

It is unlikely that any uninsured person would be able to come up with this kind of cash on such short notice. However, they are not the only ones facing trouble. Even insured people can face enormous medical bills once copays and deductibles are factored in. Many insurance policies even have maximum benefit limits, meaning that individuals might be completely responsible for their own medical expenses once the policy limits are exhausted.

Sadly, though, the financial troubles do not stop there. A major illness or injury can result in a lot of missed -- and unpaid -- time at work, and it is not at all rare for people to lose their jobs entirely after going on sick leave. Many people also turn to credit cards to pay bills and living expenses after they exhaust their resources trying to pay for medical care. Some find themselves behind on the mortgage and facing foreclosure.

Bankruptcy is often the best option

It is easy to see how a major medical issue can lead to serious financial problems. If you are facing this situation, know that you are not alone. An Oregon bankruptcy attorney can help you take stock of your finances and figure out your best options for moving forward.

A successful bankruptcy will discharge most debt, including medical bills and credit card debt. Debtors with modest incomes may qualify for Chapter 7 bankruptcy, which completely liquidates qualifying debt. Debtors with higher incomes can pursue Chapter 13 bankruptcy. In Chapter 13, debt is discharged after the debtor complies with the terms of a three- to five-year repayment plan.

Which type of bankruptcy is right for you depends on your individual goals and financial circumstances. If you or a loved one is facing financial stress because of a serious medical problem, talk to a bankruptcy attorney who can help you work out a solution.

Article provided by Daniel Hoarfrost, Attorney at Law
Visit us at www.danielhoarfrost.com/