As human beings, we fear nothing more than unanticipated, medical emergencies than anything else except perhaps death. In the blink of an eye, any one of us may find ourselves in the hospital unable to work and provide for loved ones. Whether from an undiagnosed and unforeseen medical condition, or a work-related or motor vehicle accident, medical bills can accumulate and quickly create a financial burden. Excessive medical bills are often the primary reason that people file bankruptcy.
A medical emergency may happen to anyone without warning. When injured in an accident or overcome by a severe medical condition, medical expenses may total in the tens of thousands overnight. These expenses may include ambulance, emergency room, treatment, imaging, as well as other services. It may accumulate to an extent that it is unmanageable, and start someone down the road to financial ruin. A serious, medical condition may cause someone to lose a job. The eventual result is the inability to regularly service debt causing the accumulation of late fees, penalties, and interest.
Unpaid medical bills typically go into collection sooner than other delinquent obligations such as credit card debt. This usually causes a multitude of phone calls and written correspondence. A creditor or debt collector will eventually file a lawsuit and obtain a judgment that will enable it to place liens on property, as well as garnish wages and bank accounts.
Bankruptcy’s automatic stay functions as a bar to the collection efforts of creditors, thus preventing any collection action such as garnishment or execution. The moment an individual files a bankruptcy petition to initiate a bankruptcy case, all creditor collection conduct must stop immediately.
Medical bills, like credit card accounts, are considered unsecured, nonpriority debts. Creditors for these types of debts figuratively are at the back of the line and are lucky to receive cents on the dollar in a bankruptcy case, assuming it is not a “no-asset” case as many are. Unsecured debt is unlike a mortgage or vehicle loan that is collateralized by tangible property such as a house or car.
Medical bills are dischargeable in a Chapter 7 bankruptcy case. While some types of debts are given special priority treatment and may not be eliminated or “discharged” in bankruptcy, medical debt is not.
The Morrison Law Group strives for complete client satisfaction with the services that we provide throughout a client’s bankruptcy case, as well as the ongoing services that we provide post-bankruptcy. Medical bills are one of the primary reasons most people file bankruptcy. Call 801.456.9933 today to schedule a FREE consultation. We have locations in Ogden, Logan, Sandy, and St. George to serve the residents of the counties of Weber, Cache, Salt Lake, Utah, Morgan, Davis, Washington, and surrounding areas.
