Illness and injury as contributors to bankruptcy

Medical bankruptcy is one of the problems that the public now faces. This is a situation wherein an individual or a family files for bankruptcy because of their inability to pay their medical liability. The unpredictability of the cost that someone can incur as a result of his or her medical illness or injury is the main issue in relation to medical bankruptcy. Insurance, health cares, and policies that are supposed to be helping those which can not afford their medical liability are not doing their intended purpose.

If ever they have implicated their purpose to the public, it is not enough and the problem of families filing for bankruptcy still continues. This led them to believe that insurance and health cares do little, do nothing or even add to their burden as opposed to its purpose of lessening the public’s burden from medical expenses. A call for more comprehensive provisions in insurance policy is being advocated to protect the interest of the public who are availing it. Bankruptcy means that a person or group of persons is stating that they are incapable of paying their debt (www.

anwers. com). In most instances, it is the debtor who makes the first move in filing for bankruptcy or if the debtor would not do it, the creditor may file the petition versus the debtor to get back what the debtor could not pay him (www. anwers. com). Once an individual files for bankruptcy, the court will have the control over the properties of the debtor, stops the collection by the creditor to the debtor and determines which assets of the debtor will be subjected to seizure with such exemptions as clothes, Bibles etc.

(Himmelestein, 2005). Citizens filing for bankruptcy with medical related reasons constitute half of all bankruptcies filed where it is the middle class who largely compose these debtors (Himmelestein, 2005). This was concluded from surveying 1,771 individuals who had filed for bankruptcy where about half of them had said that this was due to medical liabilities and costs (Himmelestein, 2005). How is this happening? Aren’t insurance and health care supposed to lessen the burden of the public when these kinds of cost are being incurred?

Well, these are not providing the expected relief that the public anticipated. What the public has experienced is a lapse in the medical coverage wherein they are covered at the start of their sickness but lost it along the period of illness and in some situations, having incessant coverage did not do any good where the affected individuals still experience huge medical costs (Himmelestein, 2005). The public is now wondering how continuing coverage for medical insurance is still an option for them so as to reduce out-of-pocket cost.

Due to increasing medical bankruptcy, the reliability of insurance policies are being questioned. Many citizens who are in medical debt are experiencing hardships such as being deprived of basic necessities that they would think filing for bankruptcy is the easy way out leading them to believe that coverage are too expensive or unavailable when needed (Himmelestein, 2005). The provisions in the health care policies are proved to be insufficient when the sickness befalls policy holders as they are still at risk of incurring high out-of-pocket cost (Himmelestein, 2005).

Insurance policies which are employment-based are also at risk of failing because when the sickness has led to loss of employment, the coverage is also lost which leaves the individual financially vulnerable (Himmelestein, 2005). This is a scenario where an individual has insurance coverage at the start of his illness but lost it after being sick. Loopholes in insurance policies are also another source of individuals losing faith in health cares wherein after buying insurance that they thought is reliable turned out having many loopholes leaving the individual unprotected and susceptible to high out-of-pocket cost (Himmelestein, 2006).

With this entire dilemma about insurance policies, what can be done? Reforms in the health care policies are necessary to remedy the current predicament (Fine, 2005). Professionals and doctors providing charity works to those who can not avail their services is not enough as changes should be directed at expanding the coverage policies and coming up with provisions that would ultimately benefit insurance policy holders (Fine, 2005). Insurance should be separated from employment to prevent the instances of insurance coverage being stopped once the employee become sick (Himmelestein, 2005).

Comprehensive provisions should also be created in the insurance policies to protect the insured families from the risk of incurring out-of-pocket costs that they could not afford (Himmelestein, 2005). Loopholes in its provisions defeat the purpose of having an insurance coverage in the first place. If this continues, the public would think it would be better to stop patronizing medical insurance. The option that they would turn to is saving the money that they are supposed to pay the insurance company for future possibilities of incurring medical liabilities.

This is because medical insurance are supposed to decrease the level of uncertainty of not being able to pay the insured individuals debt and not increase the uncertainty. In the end, reforming the current provisions in an insurance policy in such a way that the individuals or families are really protected and insured is the best solution to eliminating medical bankruptcy.

REFERENCES

Bankruptcy. (n. d. ). Retrieved July 30, 2007, from http://www.answers.com/topic/bankruptcy?cat=biz-fin