Kevin J. Pratt Trial Lawyer

What is the main reason people file for bankruptcy?

People file for bankruptcy for a lot of reasons, and there is sometimes the assumption that irresponsible spending was involved. However, this is not nearly as common as people may assume. Studies have actually shown that the No. 1 cause of personal bankruptcy in the United States is something you may not be able to avoid: Medical debt.

You may think that avoiding medical debt is as simple as having insurance, but that's not always the case. For example, a man knew he needed to go in for a herniated-disk surgery. He also knew it would be expensive. He'd need to pay $4,300 for the anesthesiologist, $56,000 for the main hospital bill, and $133,000 for the orthopedist. He was prepared. He'd negotiated the prices and made sure the things he wasn't covering himself were covered by his in-network insurance.

After his surgery, though, he was billed another $117,000. That money was for an assistant surgeon. At the last minute, the hospital decided to assign the assistant to his surgery, and that specific surgeon was not covered in his network. It cost him $117,000 to have one assistant for one procedure, and his insurance wasn't going to pay.

Experts warn that things like this can cause unexpected medical debt, even for those who have planned extensively. Studies have shown that four out of every 10 Americans has outstanding medical debt. This makes it far more common than in other developed countries.

If you are facing unexpected debt, and you know you can't afford to just pay it off, you may want to consider other options in Georgia -- such as bankruptcy.

Source: The Atlantic, "Why Americans Are Drowning in Medical Debt," Olga Khazan, accessed July 29, 2016

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