One of the weird things about the COVID-19 pandemic is its impact on our healthcare system. We were all instructed to stay home and flatten the curve so medical providers were not overwhelmed with sick patients. This led to an unanticipated consequence — a financial crisis in the healthcare industry.
Many people who would otherwise seek medical treatment stayed home instead. They skipped appointments and relied on Dr. Google to diagnose their ailments. It remains to be seen how this aversion to seeking care is going to impact our nation’s health, but we do know that it has hurt many medical providers.
Why Medical Bankruptcy Is So Common
Medical debt is one of the leading causes of bankruptcy in this country. Because medical debt is an unsecured debt, meaning the creditor has no collateral they can collect if the debtor defaults, filing for bankruptcy is a popular way for families to deal with overwhelming medical debts. Individuals and families can have most if not all of their medical debt forgiven if they file for Chapter 7 bankruptcy. If they instead file for Chapter 13 bankruptcy, the debt is put on a repayment plan and made more manageable.
Thanks to the coronavirus crisis, medical providers are now struggling with their own medical debt problems. It turns out a public that is trying to do its part to flatten the curve, and is also afraid of catching the virus if they visit a healthcare facility, stays home instead of visiting the doctor. Most elective procedures have been put on hold, and even seriously sick patients are opting not to receive care. This has put major financial stress on healthcare providers. There is a major cash crunch across the industry that is impacting providers in big cities like Milwaukee to rural clinics up North.
At Hanson & Payne we have been helping both patients and providers here in Wisconsin tackle their medical debts.
Right now is a great time for patients struggling with medical debt who are not interested in filing for bankruptcy to talk with an attorney about renegotiating their debt. Providers who are strapped for cash are willing to forgive debts in exchange for a lump sum payment now, even if that payment amounts to pennies on the dollar.
Providers have faced pushback and bad publicity for attempting to collect medical debts during the pandemic. Since they can’t bring money in this way, and they are not seeing patients, addressing expenses and debts is often the only option left. Our firm helps businesses make these kinds of deals on a regular basis. If more dire action is needed, we can also assist with a bankruptcy filing.
The Hanson & Payne team is committed to being there for Milwaukee area families and businesses during this challenging time. Our experience representing both creditors and debtors gives us an edge at the negotiation table, and in the courtroom. If you are looking for legal counsel in this challenging time, we would be honored to take your call. Contact us today to schedule an initial consultation.