The first thing that comes to people’s minds about bankruptcy is that most folks file because they got in over their heads with “plastic”. That means the credit card bills, with interest and penalties, are more than they can handle without help. In fact, years ago, overdue credit card bills would have been the big villain. Research shows, though, that in recent times, what’s making people sick is often medical debt.

To me, as a bankruptcy attorney in Indiana, the most interesting – and the saddest – part is this: Many of these medical bankruptcies involve relatively small amounts of money. Small claims courts are actually swamped with many medical debt suits under $5000, often under $1000.

A good part of the answer to why this is happening relates to the fact that hospitals and doctors turn their delinquent accounts over to debt collection agencies. In fact, they are doing that sooner than ever before, often within a month or two of the bill being due! The other thing we’re seeing is medical businesses being willing to sue for very small amounts, rather than just writing off those small debts. In other words, the medical providers, squeezed by reduced reimbursements from government and insurance companies, are becoming less and less flexible about dealing with patients who have trouble paying the bill on time.

As I see more and more of these situations, with creditors applying unbearable pressure on people who owe medical bills, I realize how crucial it is for anyone in this boat to talk with an attorney as quickly as possible about his or her options. Having your financial health endangered while you are fighting to regain your physical health (or a child’s physical health) is literally adding insult to injury. There’s some fighting back to do, so ask for the help you need to start fighting!