Published by Mark

Chipping Away At Medical Bankruptcy With SCHIP

March 4, 2009 at 9:02 am

As a bankruptcy lawyer in Indiana for the past quarter century, I continue to help clients with their financial problems and especially with filing bankruptcy. All too often (and this is even more prevalent in the past year or two), I encounter family situations in which there is no health insurance coverage. Sometimes it’s a single mom who lost her job and could not afford to pay the COBRA premiums. Sometimes, even if there is one parent working with the second out of a job or unable to work, that employer doesn’t offer health insurance benefits and the clients can’t afford individual coverage. Even worse is when I learn parents have been putting off routine checkups and medical help for their children as well as for themselves. In the worst cases, since medical problems are not diagnosed in time, the conditions become more severe.

Just last month, I was happy to learn, the U.S. Senate renewed and expanded the SCHIP program. SCHIP stands for the State Children’s Health Insurance Program. This program was first created back in 1997 to provide health care coverage for children in families who earn too much to qualify for Medicaid, but who cannot afford to buy private health insurance. Funding for SCHIP, as with Medicaid, is a federal program, but it is administered within each state.

The reason that I’m so interested in health insurance is that medical bills are one of the top three causes of bankruptcy. As John Ventura explains in his book The Bankruptcy Handbook, someone in the family might have been hospitalized or has a serious ongoing illness and they either have no insurance or not enough to cover the bills. Others become disabled and can’t continue working, at least not full time. Many of these same individuals have children who could qualify for SCHIP, but the parents don’t know it’s even available.

According to the Rapid City Journal , a Kaiser Foundation study estimates that in three categories of illness – asthma, diabetes, and severe trauma, the presence of health insurance is particularly important in decreasing morbidity (illness rates) and mortality. For my Indiana bankruptcy clients who’ve been laid off through downsizing or whose illness prevented them from working struggle to get back on their feet financially following a bankruptcy, the SCHIP program could literally prove to be a lifesaver.

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