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Health Care Reform May Lower Medical Debt After All

Charlotte Bankruptcy attorney Bryan W. Stone answers the question: “What is Chapter 13 bankruptcy?”



There has been a lot of debate in recent months about the impact the Affordable Care Act might have on medical debt and medical debt-based bankruptcies in the United States. Some have argued that ObamaCare will have little real world impact on debt given that many of those filing for bankruptcy today already have health insurance. However, a recent study conducted by the Federal Reserve Bank of Chicago offers some hope to those drowning in medical debt.


Stethoscope Charlotte Bankruptcy Lawyer North Carolina Chapter 13 AttorneyThe problem of out-of-control medical bills is sadly, a uniquely American problem. In no other developed country in the world is medical debt a leading cause of personal bankruptcy. However, here in the United States, it is the single biggest contributing factor to personal bankruptcy.


A study in 2008 found that 72 million Americans between the ages of 19 and 64, or 41 percent, said they had trouble affording their medical care. Among this larger group, millions of others had such extreme trouble paying bills that they were forced into filing for bankruptcy protection in an attempt to manage their mounting debt.


According to the Federal Reserve Bank of Chicago, the healthcare reform law passed in Massachusetts, upon which the Affordable Care Act is largely based, managed to reduce the overall rate of uninsured residents from 8.4 percent to 3 percent. This reduction in the levels of uninsured translated into improved financial condition for many. The study found that after the healthcare reform law was passed, the overall debt burden of those in Massachusetts declined and the average credit score improved. Most importantly, the study found that the reforms reduced the rate of personal bankruptcies in the state by 20 percent.


Similar results were found in Oregon, which broadened its access to insurance for those with low incomes. Researchers in Oregon noticed a sizable drop in the levels of financial stress suffered by residents. Debt delinquencies dropped, the amount of debt households had that was past due declined and credit scores also increased.


The hope is that the same trends that were observed in Oregon and Massachusetts hold true for the rest of the country. Given how costly medical expenses can be for the average family any attempt to bring them under control will be a welcome relief to millions of people.


If you find yourself needing the services of a Charlotte, North Carolina bankruptcy attorney, please call the skilled lawyers at Arnold & Smith, PLLC today at (704) 370-2828 or find more resources here. As professionals who are experienced in the bankruptcy arena, our attorneys will provide you with the best advice for your particular situation.


About The Author: 

Bryan 1  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.  Originally from Macon Georgia, Mr. Stone attended the University of Georgia for a BBA in Banking and Finance and went on to Wake Forest to earn his law degree.  After law school Mr. Stone relocated to Charlotte where he has become quite involved in many local organizations.  He is currently the Chair of “Bravo!” the young professionals organization of Opera Carolina, he also founded the UGA Alumni Association of Charlotte.  In his spare time he enjoys perfecting his BBQ skills for the annual “Q-City BBQ Championships” and playing softball with the Mecklenburg County Bar Softball League.



“Study: Health reform reduced bankruptcies 20 percent,” by Wendell Potter, published at Philly.com.



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