Past-due medical expenses can cause major problems on credit reports

Injuries and illnesses often happen with little to no warning to even the healthiest of individuals. If the injury or illness is serious, it may lead to costly medical treatments. Some may rely upon insurance to cover these expenses, but not all procedures will be covered, and will need to be paid for out-of-pocket.

Because these procedures can be so expensive, many individuals struggle with repaying the amounts that they owe. Hospitals and clinics are aggressive in pursuing these past-due debts, and will often initiate collections actions against those individuals who have not paid their bills.

This failure to pay for medical treatment will appear on the debtor's credit report, and it can be difficult to remove. Since so many people are struggling with medical expenses, there have been many proposals designed to help individuals having difficulty making ends meet.

A new bill currently being considered by Congress may permit individuals to have this information removed from their credit histories within 45 days once the debts have been paid or settled. This would ensure that a person's creditworthiness is not impacted by their inability to pay for unexpected medical expenses.

However, until this bill becomes law, those that are unable to pay medical bills may need to consider other options that are available. This can include working out a payment plan with the medical facility, or agreeing to a reduced balance. If neither of these options provides the individual with relief from the financial challenges he or she is experiencing, bankruptcy may be something that should be considered.

When a person files for bankruptcy, any collection actions that are in process must be stopped until the bankruptcy is complete. These past-due obligations will be addressed when designing the bankruptcy plan, depending upon whether Chapter 7 or Chapter 13 bankruptcy is filed. Since medical expenses would be considered dischargeable debt, filing for bankruptcy can allow an individual to successfully resolve these obligations.

If you are experiencing difficulty repaying your bills, you need to consider the options that are available in your situation. It is important to speak to a knowledgeable bankruptcy attorney as soon as possible to know what you can do to regain control over your finances.

You may not believe that bankruptcy is right for you, but you need to work with someone that can recommend creative solutions to your financial problems. Do not try to handle these matters on your own, because the delay may only make matters worse. These can be difficult discussions to have, but by acting now, you can start rebuilding your financial future.