An alarming number of Americans find themselves struggling because of increasing medical debts. Approximately 137 million U.S. citizens experienced financial hardship during 2019 due to high out-of-pocket expenses.
As reported by CNBC, medical expenses contributed to nearly 67% of bankruptcy petitions filed between the years 2018 and 2019. Accordingly, more than 500,000 American households file for bankruptcy every year because of medical reasons and piled-up bills. Foreclosures and struggling to make mortgage payments ranked second place as a reason for seeking relief through bankruptcy.
Falling into the medical debt trap
Medical debt may often set off a cycle that leads families into an overwhelming debt trap. When an individual requires treatment for health care, he or she may need to take time off from work. If a surgery or complicated procedure is necessary, recovery may require a significant amount of time off. In many cases, the individual’s employer does not pay for all of the recovery time required. This could become the beginning stages of a trend toward falling behind on monthly expenses and other debts.
Reducing medical bills
Research conducted by TD Ameritrade revealed that individuals of every age would consider liquidating a 401(k) or other retirement fund to decrease their medical bills. The drawback to doing so, however, is that an employee may not have enough savings to fund a comfortable retirement when he or she can no longer work.
Some individuals have reportedly found success in negotiating the amount they owe to medical facilities for treatments and health care services. Conducting a comparison of medical costs across various websites may provide a good argument for why a company should reduce its bill. As reported by AARP, an insurance claim denial may also help when negotiating out-of-pocket expenses.