Personal bankruptcy linked to medical debt in Mississippi

Financial stresses can come from a host of different sources. In Mississippi, a recent study reveals that financial challenges are particularly linked to medical expenses. This study further shows that of those filing for personal bankruptcy in Mississippi, over half are doing so because of their medical debt.

Specifically, the study reveals that of the over 12,000 bankruptcies filed this year in Mississippi, about 57 percent of them stem from medical bills. There are a number of reasons that medical expenses are piling up for Mississippians, and that they are filing for bankruptcy to eliminate debt.

One reason is the rise in cost of medical deductibles. Statistics show that in past years about a seventh of a Mississippians income was allocated to medical expenses. Now, that number has risen to a fourth of an individual's income because of increased costs.

Likewise, Mississippians are avoiding preventative care. They do not get check-ups and other routine examinations. As a result of failing to get such examinations, chronic conditions go undetected, and individuals are faced with greater costs on the back-end of responding to such conditions.

As medical debt begins to pile up, bankruptcy begins to look more appealing. Often, bankruptcy can be the right solution.

There are two main types of personal bankruptcy: Chapter 7 and Chapter 13. The first type can actually wipe out your debts, while the latter form of bankruptcy can provide individuals with time to set up a payment plan to repay bills.

No matter which type of bankruptcy for which you file, the ultimate goal is to get a handle on your finances, including medical bills. For many, bankruptcy can offer a fresh start.

Source: NPR, "In Mississippi, Bankruptcy Follows Broken Legs," Michael Martin, Oct. 11, 2013

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