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Medical bankruptcy: is there a solution?

Depending on the nation's economic state, the abundance of available jobs and a multitude of other factors, financial matters can become trying on individuals and families. One looming cause of bankruptcy in Pennslyvania is medical bankruptcy, in which individuals may seek governmental help in distressing financial times caused by overwhelming medical bills.

There are many reasons why countless Pennsylvania residents file medical bankruptcy. Chapter 7 bankruptcy has allowed many individuals to alleviate their medical debt, yet the details of Chapter 7 bankruptcy are complex and can differ depending on each case. Although there is an alarming number of patients suffering from medical debt, recent reports show a decline in this type of debt across the country. What, many might ask, allowed these rates in bankruptcy to decrease, and what may help prevent cases of crippling medical debt in the future?


The Numbers

ABC News reflected on the decline in medical bankruptcy in America, reporting that personal bankruptcy filings are down 50 percent over the past six years. Much of this decline, according to ABC, is due to former President Obama's Affordable Care Act, which reformed America's healthcare system in 2010. While courts are unable to receive information regarding the exact cause of personal bankruptcy, financial experts largely blame medical debt. Other reasons for the drastic decline in medical bankruptcy could be a slowly improving economy and relatively new laws that make the legal process for filing bankruptcy more difficult.

The Future

An improved economy and widespread health insurance certainly make the future for bankruptcy appear brighter, yet lawmakers are currently looking to nullify Obama's ACA law. Quartz weighs in on this potential change, and the possible outcomes, in medical insurance and bankruptcy. Aligning with ABC's report, Quartz adds that the ACA lowered medical-related bankruptcies by roughly 10 to 30 percent. Unfortunately, medical debt has no particular end in sight; however, experts indicate that medical bankruptcy is usually the final straw in a long period of debt related to other life expenses.  



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