Charlotte Bankruptcy Lawyer Bryan W. Stone of Arnold & Smith, PLLC answers the question “What are my alternatives to bankruptcy ?”
As North Carolina continues to struggle with the issue of whether to opt in or opt out of the Affordable Care Act’s Medicaid expansion, economists at Columbia University are touting what they see as one of the expansion’s indirect benefits: a reduction in bankruptcies.
As it turned out, the “option” was not really an option at all. It was a requirement. States were required to expand Medicaid eligibility to people whose incomes were less than 138-percent of the Federal Poverty Level. That amounts to an annual income of $19,530 for a family of three, by year-2013 standards.
A number of states took the word “option” seriously and opted out of the Medicaid expansion. They fought the Obama administration all the way to the United States Supreme Court. In 2012, the high court sided with states that viewed the term “option” as just that. States could opt out, the court ruled.
Officials in states that opted out worried that swelling Medicaid rolls would drain state coffers. The federal government has agreed to foot the bill for Medicaid expansion until 2016, with its share of the bill dropping to 90-percent thereafter.
Maine’s governor, Paul LePage, vetoed his state’s proposed Medicaid expansion in April after concluding that the administrative costs associated with the expansion were too expensive. North Carolina has not signed on to the Medicaid expansion, but Gov. Pat McCrory said last week that he was wrestling with the issue. North Carolina’s legislature is firmly against the expansion.
According to the Washington Post, refusing the Medicaid expansion could cost the Tar Heel State some $51 billion in federal funds. Currently the state covers some 1.8 million Medicaid recipients. The expansion would cover another half-million, according to North Carolina Health Secretary Aldona Wos.
Proponents of Medicaid expansion have touted the benefits associated with the increase in federal money to states. Now they are touting the effects the expansion may have on individuals and families. Some say the Medicaid expansion could cut back on the numbers of individuals and families filing for bankruptcy in the United States.
Economists led by Columbia University’s Tal Gross studied data on Medicaid expansions from the 1990s and early 2000s, and concluded that in the years after states expanded Medicaid, fewer families declared bankruptcy. Every ten-percent expansion in Medicaid coverage led to an eight-percent drop in bankruptcies, according to the researchers.
The economists theorized that families that receive Medicaid coverage are less likely to be stuck with medical bills they cannot pay, and therefore are less likely to have to declare bankruptcy. The economists see a reduction in bankruptcies as one of the indirect benefits of Medicaid expansion.
If you find yourself needing the services of a Charlotte, North Carolina bankruptcy attorney, please call the skilled lawyers at Arnold & Smith, PLLC find additional resources here. As professionals who are experienced at handling all kinds of bankruptcy matters, our attorneys will provide you with the best advice for your particular situation.
About the Author
Bryan Stone is a Partner with Arnold & Smith, PLLC, where he focuses his practice on all aspects of bankruptcy, including: Chapter 7, Chapter 11, Chapter 13, home loan modifications and landlord-tenant issues.
A native of Macon, Georgia, Mr. Stone attended the University of Georgia, where he earned a BBA in Banking and Finance, and Wake Forest University School of Law, where he obtained his law degree.
Following law school, Mr. Stone relocated to Charlotte, where he currently serves as Chair of “Bravo!” – a young professionals organization associated with Opera Carolina – and founded the University of Georgia Alumni Association of Charlotte.
In his spare time, Mr. Stone enjoys perfecting his barbeque skills for the annual “Q-City BBQ Championship” and playing softball in the Mecklenburg County Bar softball league.
Image courtesy of The National Cancer Institute.
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