[wouldntbprudent]

The researchers got the permission of bankruptcy judges in California, Illinois, Pennsylvania, Tennessee and Texas to survey 931 people who filed for bankruptcy.

"About half cited medical causes, which indicates that 1.9 to 2.2 million Americans (filers plus dependents) experienced medical bankruptcy," they wrote.

This article states that the role of credit card debt in bankruptcy is "truly a myth." My problem, at least with how the data is presented here, is that it seems to me you need to know a person's comprehensive financial situation before you can take their word for it that medical bills broke the camel's back. A person already maxed out (or beyond) on consumer debt is much less likely to be able to absorb a $12K or so (the average in the article) medical bill. A person with little debt probably can---considering that the people in the first category may have around $12K in credit card debt alone anyway and they were carrying that somehow before the medical bill. Also don't most medical billers have ways to pay by installment, etc.? So what I don't get is how many people can carry about $12K in credit card debt and be okay, but they get a $12K medical bill, which they also can pay through an installment plan, and they file for bankruptcy. I could see huge medical bills ($50K +) putting an individual into bankruptcy, but these numbers are not that big compared to voluntary debt many individuals take on anyway. (Note the article specifically says these are mostly individuals with middle-class and upper incomes.) You can hardly buy a car for $12K, but most people would think nothing of taking on car debt. Even if they have a bunch of other debt! They want a car, they get it. But a $12K medical bill--file bankruptcy. ?? I guess what I'm saying is that it seems to me that it's not necessarily correct to conclude that "medical bills" caused a bankruptcy when it may be that the reason the medical bill "could not" be paid is that the individual was already too deeply in debt.

[wouldntbprudent]

Well, well, well, what happened to ye ole formatting? No clue--sorry readers.

[durasell]

I think that what you have is people already up to their eyeballs in debt and when they get hit with a medical bill for $12k, it sends them over the edge.

That said -- I'm pretty sure a lot of credit card debt is being racked up on necessities, including prescriptions, groceries, heating oil etc.

Saying that it's just medical bills is probably just as wrong as calling them irresponsible spendthrifts. On the other hand, I have no doubt that medical bills are a significant factor.

[wouldntbprudent]

Okay, let's try this again---

This article states that the role of credit card debt in bankruptcy is "truly a myth."

My problem, at least with how the data is presented here, is that it seems to me you need to know a person's comprehensive financial situation before you can take their word for it that medical bills broke the camel's back.

A person already maxed out (or beyond) on consumer debt is much less likely to be able to absorb a $12K or so (the average in the article) medical bill.

A person with little debt probably can---considering that the people in the first category may have around $12K in credit card debt alone anyway and they were carrying that somehow before the medical bill.

Also don't most medical billers have ways to pay by installment, etc.?

So what I don't get is how many people can carry about $12K in credit card debt and be okay, but they get a $12K medical bill, which they also can pay through an installment plan, and they file for bankruptcy. I could see huge medical bills ($50K +) putting an individual into bankruptcy, but these numbers are not that big compared to voluntary debt many individuals take on anyway. (Note the article specifically says these are mostly individuals with middle-class and upper incomes.)

You can hardly buy a car for $12K, but most people would think nothing of taking on car debt. Even if they have a bunch of other debt! They want a car, they get it.

But a $12K medical bill--file bankruptcy. ??

I guess what I'm saying is that it seems to me that it's not necessarily correct to conclude that "medical bills" caused a bankruptcy when it may be that the reason the medical bill "could not" be paid is that the individual was already too deeply in debt.

[PeteB570]

You are right.

My kid went in the hospital for an operation this year and our part of the bill (co-pay) was something like $2,500. Little high to just write a check for.

We asked about monthly payments and they said they had a payment plan available. They sent us a monthly bill for $150 but we sent in $250 and paid it off in 10 months.

[Raycpa]

So what I don't get is how many people can carry about $12K in credit card debt and be okay, but they get a $12K medical bill, which they also can pay through an installment plan, and they file for bankruptcy.

With the medical bills comes lost work time. THe loss is far greater than the bill.