Ohio Medical Debt Lawyers
Medical debt is the most common reason for Americans to file for bankruptcy, largely due to the outrageous costs of healthcare in the United States.
During bankruptcy, all of your assets and debts are accounted for and evaluated to assess your overall financial picture. In some bankruptcy cases, debtors liquidate their assets and use the proceeds to repay portions of their outstanding debt. In others, consumers might restructure their debt and create three- to five-year plans to pay off their medical debt without forfeiting any assets.
The details of any bankruptcy case vary depending on your financial situation and the types of debt you owe. A medical debt bankruptcy lawyer can help guide you through the complex process of filing for bankruptcy.
Here at Amourgis & Associates, Attorneys at Law, we work with consumers throughout the state of Ohio who are struggling with their finances as a result of unexpected medical bills. We have extensive experience with US bankruptcy law, and our team has the resources and knowledge needed to help you obtain a fresh financial start. We offer initial consultations at no cost and no obligation to you, so contact us now to discuss the details of your bankruptcy case with a dedicated Ohio bankruptcy attorney for medical bills.
Can You File Bankruptcy for Medical Bills?
When you are seriously injured or ill, the cost of your medical treatment might be the last thing on your mind. Your health should always be your priority, but unfortunately, crucial medical care can be staggeringly expensive for American individuals and families.
Despite the protections of the Affordable Care Act, recent studies suggest that more than half of all unpaid bills sent to collection agencies in the US are outstanding medical debts. Nationwide surveys also indicate that overwhelming medical bills or illness-related work losses are contributing factors in a majority (66.5 percent) of bankruptcy filings.
Many people who struggle to pay off medical debts consider bankruptcy as a potential solution. While there’s no such thing as a “medical bankruptcy,” bankruptcy can help you discharge your medical debt. However, it’s essential to know that you can’t pick and choose which debts you will include or exempt from your bankruptcy filing. When you file for bankruptcy, all of your outstanding debts and assets may be fair game.
During bankruptcy proceedings, all of your debts are placed into one of three categories:
- Priority debts, such as tax debts, child support payments, and alimony payments, which receive special treatment under the US Bankruptcy Code
- Secured debts, which are debts that are “secured” by some type of physical collateral, such as a home or a car
- Unsecured debts, such as medical bills and credit card debts, which are not secured by any property and are not assigned special priority by law
Debtors who file for bankruptcy for medical bills are generally expected to pay off all of their priority debts and must pay off secured debts if they wish to maintain their collateral. However, non-priority unsecured debts, such as outstanding medical bills, can sometimes be discharged during bankruptcy, which means the debts are forgiven entirely.
What Type of Bankruptcy Do I File to Eliminate Medical Debt?
Depending on your circumstances, there are two different types of bankruptcy that you may be able to file to eliminate your medical debt:
Chapter 7 Bankruptcy
Chapter 7 bankruptcy can provide prompt financial relief from debts and debt collection efforts. Chapter 7 bankruptcy may be for you if your income is less than Ohio’s current median income level for a household the same size as yours and you cannot repay your medical debts.
During Chapter 7, debtors typically liquidate some of their property and use the proceeds to repay creditors. After debtors sell their assets to pay creditors for priority and secured debts, any remaining unsecured debts are typically discharged, including medical debts. You may be able to protect many of your assets from being liquidated by using exemptions allowed under state law. Chapter 7 bankruptcy proceedings can resolve in as little as four to six months.
Chapter 13 Bankruptcy
Chapter 13 bankruptcy may be a better option for you if you earn a regular income that could allow you to pay off your debts over time and do not qualify for Chapter 7. Chapter 13 bankruptcy is commonly called the “wage earner’s plan” because, unlike Chapter 7, Chapter 13 allows debtors to keep their assets and develop a three- to five-year plan to repay their debts.
To qualify for Chapter 13 bankruptcy, you must have a regular income, your unsecured debts must total less than $394,725, and your secured debts must total less than $1,184,200. It can take much longer to resolve a Chapter 13 case since this type of bankruptcy requires debtors to establish a years-long repayment plan. Any debt, including medical debt, that you have not repaid by the end of the repayment plan period is discharged.
Will Filing Bankruptcy Hurt My Credit?
Filing for bankruptcy can impact your credit, both in a good and bad way.
You will likely suffer an initial hit in your credit after filing bankruptcy.
Chapter 7 bankruptcies can adversely impact your credit score and remain on your credit report for ten years after the initial filing date. Chapter 13 bankruptcies also negatively impact your score but only stay on your credit report for seven years. However, the impact of bankruptcy will lessen with time.
No matter which type of bankruptcy you pursue, lenders will be able to see it for many years in the public records section of your credit report. The presence of a bankruptcy filing on your credit report may be a negative factor in future lenders’ decision-making processes. It’s possible that lenders may deny you certain types of loans or refuse to offer reasonable interest rates or favorable loan terms.
Even though bankruptcy may initially harm your credit, it will also allow you to rebuild your credit over time. Things could be even worse if you simply fail to pay your medical bills and never have the opportunity to improve your finances. Additionally, many consumers find that they are offered new forms of credit or have a higher credit score within a reasonable amount of time after filing for bankruptcy. An experienced bankruptcy lawyer can review your financial situation and determine whether bankruptcy is the right choice for you.
How Can a Bankruptcy Attorney Help with Your Medical Bill Debt?
Filing for bankruptcy is a time-consuming and detail-oriented process that can have a significant impact on your finances and legal rights. You want to avoid making costly mistakes.
A knowledgeable medical debt bankruptcy lawyer can help you by:
- Providing sound legal advice based on years of experience and familiarity with the US Bankruptcy Code and Ohio-specific laws
- Researching and reviewing bankruptcy law to identify shortcuts and streamline the process of filing for bankruptcy
- Evaluating your assets, debts, and income to determine whether bankruptcy is the best option for your situation
- Identifying whether Chapter 7 or Chapter 13 bankruptcy is better for your case
- Determining whether your medical debts are eligible to be discharged after your bankruptcy case is resolved
- Handling bankruptcy-related paperwork promptly and accurately
- Protecting you from harassing behavior by creditors and collection agencies
Having a lawyer on your side during bankruptcy proceedings can give you peace of mind and reduce the uncertainty during this stressful time. When you have an attorney advocating for your best interests, you won’t have to worry about making costly mistakes, losing vital assets, or preparing arguments for the courtroom. A medical debt lawyer will guide you and fight for the best possible outcome through every step of the bankruptcy process.
Contact a Medical Debt Bankruptcy Lawyer Today
Medical expenses can be a huge financial setback. If you have evaluated all of your financial options and believe that bankruptcy is the best choice for managing your medical debt, it’s a good idea to seek legal help as soon as possible. An attorney can help you evaluate the state of your finances and navigate the bankruptcy process with confidence.
The legal team at Amourgis & Associates, Attorneys at Law, can help you explore all of your debt relief options if you’re struggling under the weight of medical debt. Contact our medical debt bankruptcy lawyers and get the help you need and deserve. We have locations all over the state and can meet wherever is the most convenient for you.