Medical Debt and Bankruptcy

Injury and illness often happen without warning. From car accidents and work-related injuries to ongoing medical conditions, an unexpected life event can have a massive impact on your finances. During a time when wellness and recovery are most important, medical debt piles up fast, and finances seem to quickly spiral out of control. 

The truth is many individuals do not have enough money in savings to combat the exceedingly high costs of medical expenses over a lengthy period. If this debt becomes too much for someone you know or love, options are available, and an experienced medical debt and bankruptcy attorney can help. 

Scott N. Tisevich, Attorney at Law, is an experienced medical debt and bankruptcy attorney in Reno, Nevada. He offers practical advice and solutions for those considering Chapter 7 Bankruptcy or Chapter 13 bankruptcy. The Law Office of Scott N. Tisevich helps individuals who have accumulated significant medical that includes:

• Ambulance rides

• Hospital visits and stays

• Doctor and specialist visits

• Rehabilitation and recovery services

• Ongoing medical treatment 

Your personal health is vital. Consulting with a medical debt attorney is the first step in restoring peace of mind and getting your finances back on track. He proudly serves clients in Reno, Carson City, and Las Vegas, Nevada, including the counties of Douglas, Lyon, Churchill, and Story.

Will Bankruptcy Discharge Medical Debt?

Medical bankruptcy is the general term used for describing a bankruptcy that results from medical debt. While there is little debate that medical bills can create massive debt, there is no specific bankruptcy chapter dedicated to medical debt. 

Despite the lack of an official chapter assigned to medical debt, there are bankruptcy options that can discharge medical debt. Filing a Chapter 7 Bankruptcy or a Chapter 13 Bankruptcy can be used to eliminate your medical debt. 

Making the decision to file bankruptcy isn’t easy, and knowing which type of bankruptcy to file is critical to ensuring all debts will be covered. A bankruptcy attorney can clarify the options that are available and the pros and cons for each. 

Filing Under Chapter 7 for Medical Debt

Filing a Chapter 7 bankruptcy can discharge all medical debt. However, once a decision is made to file under chapter 7, a person may not be able to withdraw the petition should their circumstances change. When considering Chapter 7, it is essential to understand the pros and cons and the basic steps to file.

In general, there are three steps necessary to initiate a Chapter 7 Bankruptcy:

1. Credit Counseling — In Nevada, any individual who plans to file under Chapter 7 must first complete credit counseling by a state-approved credit counseling service provider. Credit counseling must be completed within six months of the filing date. 

2. Means Test — Completing the Means Test determines eligibility for filing under Chapter 7.

3. Required Paperwork — Once an individual has completed credit counseling and is eligible for Chapter 7, the process of completing and submitting the required paperwork begins. This typically includes itemizing assists, income, and other pertinent financial information.

Pros of filing under Chapter 7: 

• One of the least expensive forms of bankruptcy

• Quick turnaround time

• You may have the option to keep your property

Filing Under Chapter 13 for Medical Debt

Filing a Chapter 13 bankruptcy does not simply wipe out and discredit all of your debt. Rather, bankruptcy under chapter 13 creates a court-administered debt repayment plan. Think of it as a consolidation program. The debt remains, but it is re-organized in a different way to consistently make payments until the end of the repayment period. 

In general, the process of filing under Chapter 13 bankruptcy includes:

1. A detailed list of all creditors, the amounts owed, and the nature of the debt

2. A source of income and payment schedules

3. A list of all property that is owned

4. A detailed list of all monthly expenses

Pros of filing under Chapter 13:

• Repayment options over a longer period of time

• Debt can be significantly reduced through repayment plans

• You get to keep your property

A Medical Debt and Bankruptcy Attorney Can Help

Sometimes life is challenging. With the continuously rising healthcare costs, even the most financially responsible people can end up with mounds of debt. 

Contrary to what many believe, filing bankruptcy is not a financial death sentence. Discuss your situation with an attorney who is approachable, knowledgeable, and determined to provide the best outcome for your financial future. You are not alone. Contact Scott N. Tisevich, Attorney at Law, today.

The Law Office of Scott N. Tisevich serves clients in Reno, Las Vegas, and Carson City, Nevada, including Lyon, Story, and Douglas Counties.