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Can one hospital visit lead to bankruptcy?

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After an accident, medical expenses related to emergency care can be astronomical. In fact, without health insurance, you may even find yourself in the brink of bankruptcy.

With the cost of healthcare constantly increasing, many families find themselves facing economic hardship. This means that even a minor accident can cost thousands if you don’t have health insurance.

The number of bankruptcies filed each year due to medical bills has risen in the last 10 years by 10%. Many of these cases were from people with insurance that helped pay a portion of the bills, but a large percent was from individuals and families without insurance.

How much could an accident cost if I do not have health insurance?

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The actual cost of treatment following an accident will depend on your injuries and the type of medical treatment you receive. Every case is different, but the average cost for emergency room care is $3,000. This is just for the emergency room. If you are admitted or need surgical intervention, the price dramatically increases.

If you need surgery, you could be facing bills up to $100,000. On average, surgery costs around $30,000, but complicated surgeries like a spinal fusion can be triple that amount. If you need more than one surgery, you will be billed for each one individually as well.

You will receive a bill from the hospital, the surgeon, and anyone else who was involved in your care. Laboratory tests, radiographic imaging, and cost of anesthesia are billed separately as well.

The average cost for one night in the hospital is $1,500. The average stay is four days. This means you could end up paying another $6,000. If you need to be in intensive care, the expense is even higher since you will require extensive monitoring and specialized care.

As you can see, these expenses add up fast. Even after you leave the hospital, you will need follow up care. You may be facing months of doctors’ visits and physical therapy. If you have severe injuries, you may not be able to work. This means in addition to the bills, you will lose income.

What happens if I cannot pay the medical bills from my accident?

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Hospitals and doctors will make numerous attempts to contact you to collect money towards your bills. If you do not pay your hospital bills, they will be forced to take further action.

The hospital will sell your debt to a third-party collection agency and be forced to write off the remainder of your debt. The collection agency is now free to attempt to collect your debt and will typically harass you on a daily basis. In addition, they will also report your debt to credit bureaus. This can have a negative impact on your credit, making it difficult to get a loan, buy a car, or even rent an apartment. Furthermore, this information stays on your credit for up to seven years.

If unable to collect the debt, many collections agencies will file a lawsuit against you and take you to court.  The type of lawsuit they file against you will depend on the amount of debt owed. At this point, not only are you in hot water due to medical bills, but now you have legal fees to contend with.

If you fail to appear in court, the judge will grant the collection agency a judgment. This means the agency can then put a lien on any property you own to collect their debt. If you try to sell the property, the profits will go to the lien holder to pay your debt. If the profits do not cover the full amount of the lien, you will have to pay the difference before you can complete the sale.

Collection agencies can also use the judgment issued to garnish your wages. They will notify your employer of the judgment and the amount to garnish from your paycheck. Your employer is legally obligated to comply and will take a specific amount of your pay and send it to the collection agency.

With more and more people facing economic hardships, they are forced to file bankruptcy. When you file bankruptcy, the courts will either appoint a trustee to manage your assets or accept a payment plan to pay off your creditors. This will depend on which type of bankruptcy you file.

Once you have completed your obligation under the terms of your bankruptcy, any remaining debt is discharged. A bankruptcy will stay on your credit for seven years. In most cases, you have no credit available and your credit score is too low to get new credit if needed. This means if you have another financial crisis, you may end up right back where you started.

Is there any help available for medical bills?

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Most hospitals will try to work out some type of payment plan with you. They would rather receive small payments over time than nothing at all. If you do not make the agreed upon payments, they will send your account balance to collections.

You can also see if your hospital or doctor offers a sliding scale to help reduce overall costs for people with lower incomes. Many hospitals also have a list of non-profit organizations who can assist with medical debt for qualified individuals.

Never take health insurance for granted. Without having health insurance almost everyone in America is one single accident away from financial ruin.

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