How Medical Debt Affects Low-Income Families

Limited Access to Preventive Care

Minor health problems can develop into significant diseases needing expensive treatment if regular check-ups and preventive care are not received. Low-income family members cannot afford to spend on preventive medical care because of past-due medical bills. This delay causes the progression and exacerbation of the disease, with more costly treatments.

The Mental & Financial Distress Caused by Medical Debt:

Not only does medical debt cause financial difficulties, but it also has a negative emotional and mental impact on individuals and families. People incurred by medical debt often go through mental health issues due to the anxiety of unpaid bills and collection efforts. Families might also encounter:

Decreased Quality of Life

Families with enormous debt may put off getting critical medical care out of fear of taking on more medical debt. Delays in getting appropriate medical care can result in deteriorating health issues that may eventually require even more costly medical measures. Consequently, a vicious cycle emerges in which financial stress worsens medical problems, increasing the debt load. This circumstance can have a significant emotional toll, compounding already-existing physical and financial difficulties with mental health issues.

Impact on Credit Ratings

Unpaid medical bills have a long-term impact on credit ratings. Medical debt hurts credit scores and makes loan procurement, mortgage, and employment in the future harder.

How Bankruptcy Can Resolve Medical Debt

As a last alternative to avoid financial collapse, people with excessive medical debt may file for bankruptcy. Bankruptcy provides a legal way for many low-income families drowning in medical debt to eliminate or reorganize their financial obligations. Individuals can file for bankruptcy in two typical ways: Families can start over financially by filing for Chapter 7 bankruptcy, which permits the discharge of unsecured medical debt. Chapter 13 Bankruptcy helps families gradually recover financial stability by restructuring debt into affordable installments.

Systems to Help Low-Income Residents in Medical Debt Crisis

There are several assistance programs and systems to help low-income individuals and families access affordable healthcare. 

Ensuring Affordable Healthcare Costs:

Low-income families can obtain healthcare at a lower cost because of government programs like Medicaid, the Children’s Health Insurance Program (CHIP), and the Affordable Care Act’s (ACA) private insurance subsidies. Medicaid eligibility expansion in states that have not embraced it might provide millions of uninsured people additional coverage. Additionally, middle—and low-income households may find insurance more affordable if governments increase marketplace health plan subsidies.

Financial Aid Programs in NPO Hospitals:

Many non-profit hospitals provide financial aid programs or charity care alternatives. These programs can drastically lower or even eliminate medical expenses for qualified individuals. However, many people are either ignorant of this assistance or find it challenging to complete the application procedure. If financial assistance programs are more transparent and the application procedure is more straightforward, more people can get the aid they require.