Medical Debt
Rising healthcare costs and difficulty accessing good insurance coverage means that medical debt in America is an increasing problem. Carrying high debt balances doesn't always mean that a person went on a shopping spree with a credit card in hand. Often, unexpected life circumstances, accidents, or diagnoses can lead to medical bills and rising living expenses. If these expenses start to feel overwhelming and insurmountable, it may be time to consider medical debt relief options.
Medical Debt from High Insurance Premiums
Even if you have insurance coverage, it's sometimes difficult to meet the insurance premiums. Some families pay thousands of dollars for insurance coverage per month, and this premium expense takes away from money needed for rent, food, and other basic living expenses. Thus, the debt starts to add up as the family is working to stay ahead of the never-ending costs. The situation could be made even worse if the family has medical debt in collections.
Poor Medical Insurance Coverage
At the same time, the insurance plan you select may offer poor insurance coverage. If you selected the cheapest plan, you’ll probably have less coverage, meaning not all your medical costs will be covered. In fact, it's common for people with insurance to rack up medical debt in the US because of the high amounts that need to be paid for deductibles, co-pays, and medications.
Change in Medical Coverage
Another common occurrence that leads to medical debt, is the change in coverage that can happen through open enrollment. At one point you may have been covered, but now you’re not and it often feels like you can never stay ahead because the plans are constantly changing. It's essential to be diligent in tracking coverage changes, so you can optimize healthcare treatments based upon the available payouts from the insurance company.
Medical Debt from Injury, Severe Illness, or Chronic Illness
One accident or diagnosis of a chronic illness can be a financial catastrophe for your family. Medical debt often adds up quickly when a big medical event happens. This medical problem can lead to large amounts of debt as you try to pay for basic services.
High Cost of Prescriptions in the Medical Field
The price of a prescription varies depending upon the medication and the name brand. Some essential medications needed for treatment can cost hundreds or even thousands of dollars per month. Insurance companies typically have limits on how much they'll pay for a prescription, which means that the patient needs to pay for the rest out-of-pocket.
High Cost of Treatments in the Medical Field
Don't overlook how much medical debt can add up due to the increasing cost of treatments. For example, premature birth or a cancer diagnosis could result in more than a million dollars in medical bills. Even just one day in the hospital can cost more than $5,000, and a multiple-day hospital visit can result in an exorbitant bill.
High Deductibles in the Medical Field
Most insurance plans have a preset amount that needs to be paid each year before coverage kicks in. Medical debt can accumulate quickly when you need to pay high monthly premiums plus thousands of dollars more each year to meet the deductible.
Other Costs from Medical Issues
Not only does a patient carry the weight of medical debt from bills, prescriptions, and deductibles, but living expenses start to add up as well. For example, an injury or illness can have a negative impact on someone's ability to work. When the person is taken out of the workforce, it puts undue pressure on family members and other caregivers.
Inability to Work
An inability to work also causes a domino effect on other details related to health insurance and medical debt. One common problem is the gap in insurance when someone is between jobs. The worker might be hired at a new job with minimal downtime between jobs. However, many companies have a 90-day waiting period before insurance benefits are offered. This time without insurance coverage can cause financial issues for someone suffering from a chronic medical condition.
Other Medical Treatments
Other lifestyle factors can increase overall costs as well. Sometimes, it's recommended that a person needs to buy specific medical equipment to use at home, follow a certain diet, or pay for alternative therapies.
Family Medical Costs Can Lead to Debt
If a patient is unable to self-care at home, then the medical debt can climb due to the high costs for in-home caregiving, assisted living facilities, and ongoing medical care. Every person deserves quality care for individual health concerns, but these services come at a price that can be hard to pay. Families want to ensure the comfort and treatment of their loved ones, so they take on medical debt to provide the necessary services. A person can be in great health but have a lot of medical debt due to family medical costs.
The Domino Effect from Medical Debt
The biggest problem with medical debt is that it can be difficult to get ahead when the costs start to creep up. Even if you're diligent with payments, the expenses accumulate. Not only are additional medical costs added to the financial burden, but it's also common for interest costs and late fees to raise the balance even more.
Eventually, old medical debt can be sent to collections, making it more difficult to handle the overall situation. Now, the constant phone calls and payment notifications are coming, making it hard to find peace in a challenging situation.
Unfortunately, these cascading problems often lead to drastic measures, forcing families to pay for bankruptcy or take out additional loans to meet current needs. Over half the bankruptcy filings in the United States are associated with medical debt.
Getting Ahead: Overcoming Medical Debt
If you're already in debt with a mortgage, car loans, and credit cards, then you're in the same situation as many other Americans who find it challenging to pay for medical treatments. Rest assured that options are available to help.
You might consider the benefits of medical debt consolidation or medical debt negotiation. It's common for individuals to have multiple creditors and accounts to handle. This debt can be negotiated and rolled into one balance, giving the debtor a simple way to pay off the balances with a single monthly payment. This process can also help by managing interest rates and avoiding additional charges for late fees and other costs. With the right financial plan, you can eliminate the stress of paying for health costs by taking care of medical debt in an effective way.
