Is it possible to declare bankruptcy on ludicrous hospital bills?

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Olaz
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Is it possible to declare bankruptcy on ludicrous hospital bills?

Postby Olaz » Tue Dec 27, 2016 7:10 am

https://www.google.com/amp/s/redditblog ... rgery/amp/

https://www.google.com/amp/www.msnbc.co ... l-bill/amp

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I was listening to a podcast that mentioned a one million dollar hospital bill -- I thought they were joking until I looked it up.

What can one do when faced with catastrophic bill like the above? My initial impulse is to go to court, file bankruptcy, or leave the country with brokerage accounts in tow.

Thoughts?

RealPerson
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Re: Is it possible to declare bankruptcy on ludicrous hospital bills?

Postby RealPerson » Tue Dec 27, 2016 9:30 am

Olaz wrote:My initial impulse is to go to court, file bankruptcy, or leave the country with brokerage accounts in tow.

Thoughts?


Go to court and file for bankruptcy: yes if you have debt and no more assets
Leave the country with brokerage accounts: that is fraud and will likely land you in jail

If you never wish to return to the US, you could try that. Savvy people use legal constructions to shield their assets from creditors. This requires advanced planning and makes more sense if you are wealthy. It is one of the ways that the law works for rich people and not for poor folks. Setting up legal structures to protect assets after you are in financial trouble is illegal.

scriptbunny
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Re: Is it possible to declare bankruptcy on ludicrous hospital bills?

Postby scriptbunny » Tue Dec 27, 2016 10:22 am

Before filing for bankruptcy I would try to contact the hospital and see if they have grants that might cover your bill or if they'd be willing to negotiate it down. It's pretty common for patients to not be able to pay their medical bills and hospitals, knowing this, are often willing to settle bills for a fraction of their worth. I know people who've gotten 80%+ knocked off and the rest on payment plan by applying for financial assistance through the hospital.

Also, in both linked stories, these were instances where individuals did not have health insurance valid in the US. So... make sure you have health insurance I guess is the moral of the story?

RealPerson
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Re: Is it possible to declare bankruptcy on ludicrous hospital bills?

Postby RealPerson » Tue Dec 27, 2016 12:25 pm

+1. Bankruptcy means a total loss for the hospital. They would rather get something than nothing. Do your best to stay healthy as a first defense, have insurance as a second defense, and finally negotiate with the hospital as a third defense. Well, a one way ticket to Argentina could be fourth.

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fiby41
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Re: Is it possible to declare bankruptcy on ludicrous hospital bills?

Postby fiby41 » Tue Dec 27, 2016 11:20 pm

Medical tourism seems less hassle.

EdithKeeler
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Re: Is it possible to declare bankruptcy on ludicrous hospital bills?

Postby EdithKeeler » Wed Dec 28, 2016 7:26 am

Medical bills are cited as the number one reason for bankruptcy in the US.

https://www.google.com/amp/www.cnbc.com ... ent=safari

I know someone who has declared BK twice over medical bills. Once he had no insurance (pre-ACA) and the second time he had a shitty employer plan. Dude makes $10 an hour, and even after negotiating the bills down, they were still well over $150k each time.

The second time, he tried really hard to pay it, and he did pay his surgeon and a couple other parts of the bill (because you know it's not just one bill...).

I'm getting on my soapbox here, but the state of paying for healthcare for certain segments of society in the US is just shameful. The dude is my brother, he's slightly handicapped, but makes too much money to qualify for Medicaid or assistance. Now he's got a good policy thru his work, but a couple of years ago I was helping him ship for health insurance on the exchanges. The cheap policies are cheap but don't cover much; expensive policies are too expensive if you're somewhat poor and happen to have health issues.

He's not even someone who's a big risk for health issues --not obese, no drug or alcohol habits, etc. But two instances of really, really bad luck (asthma attack, after being well controlled for years and years, landed him in the hospital where he was in an induced coma for over two weeks, and a case of diverticulitis that they kept trying to treat conservatively which ended in sepsis and losing 2 feet of intestines!) really fucked him over.

Ok, <deep breath>. Yes, you can file bankruptcy for medical bills.

Scott 2
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Re: Is it possible to declare bankruptcy on ludicrous hospital bills?

Postby Scott 2 » Wed Dec 28, 2016 1:06 pm

Defense is the place to start. Insure properly. Determine cost up front. Put money into assets that are hard to touch - house, retirement funds, car. Negotiate bills.

But yeah, the medical system can ruin you financially. Heck, confidence in meeting my medical expenses doubles my required retirement assets. It's better than being denied care, I suppose.

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Olaz
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Re: Is it possible to declare bankruptcy on ludicrous hospital bills?

Postby Olaz » Wed Dec 28, 2016 1:24 pm

@Scott 2: Yeah, it seems more than a little disheartening to think that we can save 500k through tooth and nail over 5-10 years, yet it only takes one emergency hospital bill to take out that entire nest egg, if not more. Perhaps even while insured, like one of the two cases above.

Sounds like bullshit :(

Lucky C
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Re: Is it possible to declare bankruptcy on ludicrous hospital bills?

Postby Lucky C » Tue Jan 10, 2017 5:15 pm

Related question: can you legally hide all your wealth if faced with something like a ridiculous medical bill or a frivolous law suit? Like if you liquidate your brokerage account, buy some gold bars, and bury them somewhere, is that illegal? What about giving it away to someone you trust with the agreement you'd get it back after the ordeal? Morally I would be OK with pulling something sneaky like that if the charges are unjust, but I would think you would have to prove that you really don't have access to the money anymore to get away with it.

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Miss Lonelyhearts
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Re: Is it possible to declare bankruptcy on ludicrous hospital bills?

Postby Miss Lonelyhearts » Tue Jan 10, 2017 6:39 pm

No, it would not be legal to falsify an asset statement or misdeclare your wealth in the face of a judgment. Going bankrupt requires you give a sworn statement of all your cash and non-cash assets. Buried gold counts as an asset. Money you gave to friends with the understanding they will return it to you, ditto.


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