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Medical debt expected to be No. 1 cause of bankruptcy

When a consumer experiences an unexpected medical condition there is little option but to see a doctor, regardless of their financial situation. As a result, it is not uncommon for consumers to face huge medical debt that far exceeds their ability to pay. In fact, as many Tennessee readers already know, medical bills or outstanding medical debt is one of the leading causes of bankruptcy filings in the Untied States.

According to a study published in 2013, medical debt is expected to surpass credit card debt and mortgage debt as the leading cause of bankruptcy. While the news may come as a surprise to some, especially with the passage of the Affordable Care Act, some experts think the act will actually have little effect on medical bankruptcy. One reason is that medical bankruptcy is not simply about insurance. In fact, research shows that many consumers that file for bankruptcy due to medical debt have health insurance.

This may sound counterintuitive to some readers but the fact is many people struggle to cover expenses related to co-pays as much as anything else. This is especially true if a person is suffering from a chronic disease such as cancer. In such cases, despite insurance a person may experience significant costs trying to cover their co-pays, co-insurance and travel. This does not even take into consideration lost wages due to illness, increased day care costs and other expenses such as high deductibles.

Dealing with serious financial challenges and an unexpected medical condition at the same time can be too much to handle. Fortunately, there is help available for individuals looking for a fresh financial start. While there are many forms of debt relief, filing for bankruptcy allows consumers to stop creditor harassment as well as extinguish most, if not all, of their debt with relative ease. And best of all, the process of rebuilding your financial freedom can start immediately.

Source: Fox Business, "Medical Bankruptcies are Still a Problem, Here's What to Expect," Donna Fuscaldo, Feb 18, 2014

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Mark T. Young & Associates
2895 Northpoint Blvd.
Hixson, TN 37343

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