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Charity care from hospitals could help people avoid medical debt

People in Louisiana confronted by high medical bills should investigate whether their hospitals offer assistance to people unable to pay. Some hospitals that accept government funding have an obligation to set up charity care funds. They usually do not promote the programs, but hospitals have billions of dollars available nationwide to help people challenged by high medical costs. According to the American Hospital Association, U.S. hospitals offered $38 billion in financial assistance to patients in 2016.

To qualify for assistance, people should ask about charity care funds as soon as possible and definitely before a medical bill goes into collections. Once collection agencies acquire medical bills, the debtors have likely missed the chance to take advantage of charity care, if available.

Application procedures vary by hospital, but uninsured people will often qualify. Even people with health insurance might be able to gain payment for their out-of-pocket expenses depending on their income. 

How bankruptcy might help

Medical debts plague individuals and families at all income levels. One survey asking people about medical bills revealed that nearly half of respondents had medical debts that they could not pay.

For some people, filing for bankruptcy might provide relief. A person may wish to speak with an attorney to learn if this approach would prevent continued financial hardship. After studying the person's income and assets, an attorney may prepare a payment proposal and file it with a bankruptcy court.

If the person doesn't qualify for Chapter 7 bankruptcy, Chapter 13 might be an option. This process does not require the liquidation of personal assets, but the debtor must adhere to a payment plan that sends money to creditors. These plans generally last three to five years. After completing all payments, a debtor might gain a discharge of remaining balances. This type of bankruptcy may enable a debtor to meet manageable payments and avoid falling behind on household bills and debts.

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