New Program Aims to Lower Medical Care Costs

Posted on June 25, 2013 by Staff Writer

It’s no secret that healthcare will be one of America’s greatest challenges in the 21st century. Due to the rising costs of medicine and the growing percentage of an older population more at risk of expensive procedures, it’s no wonder that medical bills are one of the leading reasons for personal bankruptcy. In fact, according to a survey conducted by the Harvard Law School and Ohio University and reported by Reuters, more than 60 percent of personal bankruptcies in the U.S. every year are because of medical bills. “Unless you’re Warren Buffet,” Harvard’s Dr. David Himmelstein told Reuters, “your family is just one serious illness away from bankruptcy. For middle-class Americans, health insurance offers little protection.”

This can be terrifying for any family with older members who are now considering their options. According to National Public Radio, the annual average cost of a nursing home with a semi-private room is almost $80,000—not a small bill by any means. The average annual cost of having someone to work as a home health aide is just over $20,000, which is significant as well. But a new experimental nationwide program is aiming to “keep people healthy and out of the hospital,” which will hopefully help to lessen some of these cost burdens. The program “dispatches hospital-trained nurses to patients’ homes to do whatever is necessary—manage prescription drugs, take blood-sugar readings, teach healthy eating habits or even arrange delivery of a motorized wheelchair,” according to AZ Central.

The government is calling these new initiatives Accountable Care Organizations, and Banner Health, a Phoenix-based hospital system, is among 32 organizations in the country to adopt the experimental program, according to AZ Central. These are meant for people on government-issued health insurance, but “private insurers such as Cigna and Health Net are launching similar agreements with hospitals for patients who have private health insurance.” A spokesperson for Banner told AZ Central that during the first year that the program was in operation for 51,000 metro Phoenix residents, “it reduced Medicare spending by 2.5 percent per person.”

If you or someone you know is facing bankruptcy because of high medical bills, don’t go through it alone. Contact a dedicated Arizona bankruptcy attorney today.

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Most Common Causes of Bankruptcy

Posted on June 9, 2013 by Staff Writer

Bankruptcy provides a great tool for people who are unable to dig out of financial holes. Rather than lose everything you have, bankruptcy can allow you to reclaim your life. But not all bankruptcies are brought about by crazy spending sprees. Do not let the stigma associated with bankruptcy influence your decision if your finances have gotten out of control.

According to multiple studies of the causes of bankruptcy, there are a handful of common causes of bankruptcy, one of which is excessive spending. The least common cause of bankruptcy is unexpected disasters or calamities. If a catastrophe changes your situation either by taking away your car, your job or other things you need to live, then bankruptcy can help you regain your footing on solid ground. This cause of bankruptcy only influences about seven percent of all filings.

Another cause of bankruptcy is divorce, which is how half of marriages end. From a financial standpoint, divorce can make it difficult to live the life you had before. You need to maintain two households with the income from your married life. It is also necessary to pay for legal fees, alimony, and child support if you become single again. Divorce contributes to eight percent of bankruptcy filings.

Job loss has been a very prevalent cause of bankruptcy in recent years. Almost eight percent of Americans are currently unemployed as of May 2013. These people usually pay for insurance out of pocket which can be a drain on already depleted household income. 22 percent of bankruptcies are influenced by unemployment.

By far the most usual cause of bankruptcy over the years is medical expenses. The bad news is that medical costs will continue to rise as new medicines and procedures are developed to keep us healthy. In 2013, Reuters figured that medical costs would increase by almost eight percent from 2012. When medical costs are already too expensive for most households, bankruptcies will be more prevalent. If you feel that any of these reasons is putting a strain on your finances, then consider reaching out to a skilled bankruptcy attorney from Phoenix today.

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Bankruptcy and Medical Bills

Posted on May 31, 2013 by Staff Writer

With the implementation of Obamacare getting closer, there are several questions about what the Affordable Care Act will do for Americans facing high medical bills due to an ongoing illness or disease. According to the Washington Post, “the nonpartisan Congressional Budget Office estimates that 30 million more Americans will have health insurance by the end of decade.” That’s a big number, but it doesn’t take into consideration those Americans who will indeed have coverage, but who “will still face big financial burdens after they gain insurance coverage,” a sub-sect that will likely exist, according to two new academic studies cited in the Washington Post.

According to Reuters News Service, “medical bills are behind more then 60 percent of U.S. personal bankruptcies.” U.S. researchers told Reuters that, “for middle-class Americans, health insurance offers little protection,” and even healthcare reform isn’t on the right track. Dr. Sidney Wolfe of the Health Research Group at Public Citizen told Reuters that “expanding private insurance and calling it health reform will fail to prevent financial catastrophe for hundreds of thousands of Americans every year.”

Arizona has long had one of the highest rates of both personal and consumer bankruptcies in the country. Though that number significantly decreased from 2011 to 2012—according to Arizona Bankruptcy Courts, by 22.2 percent—Arizona residents are still at a high risk of bankruptcy. In 2012, there were 27,298 bankruptcy filings in Arizona, the large majority of which were in Phoenix.

As Obamacare is implemented, everyone will be looking to see if the expanded coverage will reduce bankruptcies due to medical bills. Stephanie Woolhandler, a professor at the City University of New York, conducted research to determine this on a smaller scale after the state of Massachusetts expanded healthcare coverage, and found that “in 2009, two years after the insurance expansion took effect, just about half the debtors (52 percent) attributed their bankruptcy at least in part to medical bills,” according to the Washington Post. “In 2007, before the expansion, the number stood at 59 percent.”

If you or someone you know is considering bankruptcy because of medical bills or any other reason, don’t go through it alone. Contact a dedicated Arizona bankruptcy attorney today.

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Avoiding the Sinkhole of Medical Debt

Posted on April 10, 2013 by Staff Writer

A recent U.S. News and World Report article reports that debts from medical expenses are one of the most common reasons for filing bankruptcy. As more and more people struggle with the ever-increasing costs of health care, there are a few steps that can be taken in order to avoid falling into insurmountable medical debt.

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First, always at least maintain catastrophic health insurance coverage. A plan with a very high deductible won’t provide you with relief for minor or routine medical expenses, but it will avoid you being stuck with tens of thousands of dollars of medical bills which you may never be able to pay off if you suffer a major illness or injury.

Next, make sure that the care that you choose to receive is the most cost-effective care possible under the terms of your medical insurance policy. For instance, many insurance policies contract with certain doctors or medical facilities that are considered to be in-network providers. In this case, going to an out-of-network provider will likely result in much higher costs than if you simply went to an in-network provider. By taking all reasonable steps to comply with the terms and conditions of your insurance policy, you can minimize your out-of-pocket costs.

Other important steps to avoiding medical debt are to pay only what you owe and negotiate those bills that you do owe. Make sure that you are only charged for the care that you received and that your bills contain no errors. Once you have determined that your bill is correct, try negotiating a payment plan or applying for financial assistance to have some of your debt forgiven, which is available through many hospitals and other medical providers.

You can also use a regular savings account, a flexible spending account, or a health savings account to build up funds that can be used in case of medical emergency. By having money available in case these kinds of expenses occur, you can avoid going into debt to pay medical bills.

Finally, if you have unavoidably racked up thousands of dollars of medical bills, bankruptcy may be a solution for you. Contact your Phoenix bankruptcy attorney today, and discover whether bankruptcy is a viable option for you.

Delinquent Medical Debt Leads to Increase in Bankruptcy Filings

Posted on May 6, 2012 by Staff Writer

Most people think that most of those who file bankruptcy did so because they got way over their heads in credit card debt; however, research shows the truth is much more surprising. Roughly 20 percent of those seeking financial counseling required for bankruptcy filing this year and last cited medical debt as the primary cause of their decision to seek bankruptcy protection, according to CredAbility, an Atlanta-based nonprofit credit counseling agency that serves clients nationally. The analysis included more than 47,000 clients for the first half of this year, and more than 100,000 from last year.

A significant percentage of those listing medical debt as the reason for their bankruptcy are 65 and older. Other groups disproportionately bankrupted by medical debt include single women raising children on low wages or who have been abandoned by their husbands who refuse to pay child support.

With unemployment persistently high, more people have lost health coverage along with their jobs. People who have lost their jobs, but are continuing their group coverage under the federal law known as COBRA, may find it difficult to make the higher premium payments and are slipping into default on premiums and medical bills at an increasing rate.

Health costs are escalating for employed people as well in the form of higher premiums and deductibles. More health plans are offering lower monthly premiums in exchange for higher deductibles, but that means people find themselves on the hook for more out-of-pocket costs if they get sick.

If you are struggling with medical debt, consult with a qualified Tucson, Arizona bankruptcy attorney, who can help you explore if bankruptcy is an option for you. Tucson bankruptcy lawyers are familiar with all of the available options for relieving your debt, and can discuss the best route for your particular situation.