Bankruptcy Is Something You May Need Without Health Coverage
Written by Julie Johnson
I am a bankruptcy lawyer in Florida and every week I meet people who want to start over with their lives and get rid of overwhelming debt. Sometimes the debt is their own fault because they misuse credit cards or gamble. Maybe their business failed; maybe they lost their job and were now living way above their means. The cases that really touch a nerve are those people who have health insurance issues and are now facing thousands of dollars in medical bills through no fault of their own.
One client was fighting breast cancer and lost her job and health insurance through cutbacks with her company. She was responding well to the cancer treatments, and without them she was certain to die. Her health insurance company wouldn't insure her through COBRA, so she continued her treatments and medication using credit cards to pay for everything. When she came to me, her cancer was in remission, and her credit card debt was over $150,000.
Another man came to me after he had been in a car accident and had been in a coma for several weeks. He had just gotten a new job and his health insurance would kick in after a 90-day probation period. When he got into his car, life was good and he had everything to look forward to. Without warning and without knowing it, he ended up in the hospital unconscious with several broken bones. After he woke up he had to stay in the hospital for a while and eventually was moved to a nursing home to get therapy. He lost his job, and now he was about to lose his house. The accident was the other person's fault, and neither the other driver nor my client had the proper car insurance to cover my client's injuries. Without the proper car insurance and certainly without health insurance, this man now had hospital and doctor bills well into the six figures.
Another client I had came to me with about $110,000 in debt in hospital bills. His child needed a kidney transplant. He was covered by insurance, which paid for many medical procedures for his child. Then because of mis-communication or misinformation from his company and the insurance company, he lost his coverage without his or the hospital's knowledge. The hospital kept treating the child as if the man had full coverage, and the child even got the kidney transplant. But when the bills were sent to the insurance company, much of the costs were denied. The man had been on full-time status at his job, but his work hours had been cut back to part-time hours, and his insurance coverage was cut proportionately. His family was covered for doctor and emergency room visits as well as hospital stays up to a certain dollar amount per year. When he reached that amount, he had to pay for everything out of pocket. What was really unfortunate was that the doctors wanted to get the transplant done before Christmas so the child could be home with his family for the holidays. If they had waited until after the new year, the expenses of the operation would have gone to the next year's coverage.
Medical expenses for a catastrophic event can be astronomical, and overwhelming medical expenses is the number one reason people turn to bankruptcy. If someone faces a catastrophic injury or illness with poor or no health insurance coverage, their life and the lives of their loved ones can be ruined.
