Medical emergencies don't just cause us physical pain, they can also add to the emotional and financial stress of an already overburdened debtor. So what can a debtor do to minimize the financial fallout of a medical emergency?
- The first step to dealing with a medical emergency is to assess the financial damage. How much are the medical bills? Are you able to continue work? Maybe you need to cut back on your hours or you will need to leave your job completely. Whatever the case, you need to figure how this medical emergency has impacted your income in the short-term and the long-term.
- Communicate, communicate and communicate! Staying in touch with your creditors is important to minimizing the impact of a medical emergency. Contact your creditors and find out if they are able to defer payments while you are recovering from your medical emergency. Many creditors are willing to defer payments for about 90 days; but this type of deferment will only be useful if you know that you will be able to pay your bills after the deferment has lapsed. If your medical emergency will have long-term negative impacts on your income, then you may want to seriously consider filing bankruptcy. Bankruptcy will allow you to discharge most if not all of your unsecured debt and give you an opportunity to get a fresh new start.
- Take care of the essentials first. Even if you eventually file bankruptcy, you will still need to pay for your secured debts unless you plan to surrender your property in bankruptcy. If you have the income, redirect your money to your mortgage/rent and car note payments.
- If your medical emergency has created a created a large amount of medical debt, you may be able to get some of that debt reduced by talking to the hospital's billing department if you're uninsured. If however, you are unable to pay your medical debt, you may be able to discharge it in Chapter 7 bankruptcy or even repay part or all of it in a Chapter 13 bankruptcy repayment plan.