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Medicaid reductions could lead to more bankruptcy filings

When Obamacare was enacted, the rate of people who had to file personal bankruptcy due to medical bills decreased. With the cuts to Medicaid that are being proposed in Trumpcare bills, the rate of personal bankruptcy filings might start ticking up again.

Medicaid currently covers around 74 million Americans. These are low-income people who need help covering even the most basic medical needs. It is estimated that around 15 million people would lose health care coverage by 2026 if Trumpcare becomes law. Another estimate puts that number at closer to 22 million people who would lose coverage.

For the adults who count on this coverage, getting high medical bills could be financially devastating. These individuals might have to turn to bankruptcy to get rid of these high bills, but this will only present a temporary solution to a long-term problem.

The inability of patients to pay and the loss of the Medicaid safety net will send ripples and shock waves through the economy. Hospitals will feel the first impacts because they will have to deal with unpaid bills while continuing to provide patient care. This could lead to an increase in costs of care to compensate for the loss of revenue. Other areas of the economy would then begin to feel the effects of this loss of Medicaid coverage.

Even now, people who are getting in medical bills might find that they just can't keep up with those bills while paying for normal life expenses. In these cases, filing for bankruptcy might be the only option for reclaiming their financial stability. Not only can you file for medical bills, you can also include other bills like credit card bills. An attorney can provide you with more information on bankruptcy and how it may help your situation.

Source: Time Magazine, "The Senate Health Care Bill Could Lead to More Personal Bankruptcies," Jennifer Calfas, June 26, 2017

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