Filed for bankruptcy due to overwhelming health care debt? protect your future

Once you’ve decided to file bankruptcy to alleviate overwhelming medical debt, you should consider how to best protect yourself in the future. Unless you take steps to prevent this debt from reoccurring, you may find yourself in medical debt again without the benefit of filing for bankruptcy again. Protecting yourself from future medical debt should be one of your first concerns when filing for Chapter 7 or Chapter 13 bankruptcy. People who have gone through bankruptcy due to devastating medical expenses have learned the hard way that their health insurance was inadequate. and it didn’t fully protect them from financial disaster. Most people are insured through an employer-provided health care plan. These plans typically cover only a small percentage of the costs incurred after an illness or catastrophic emergency. Some people buy their own health care plans. These people are usually self-employed. Individualized health care coverage is very expensive, and these plans also have limitations. Still, there are options an individual can take to supplement their health insurance coverage, minimizing the risk of them once again being overwhelmed with medical debt.

Customizing health insurance can be a useful tactic. People who buy their own health insurance have the advantage of tailoring their insurance plan to their individual needs. They may change your deductibles and coverage to reflect your specific health circumstances. Although employer-provided health insurance is often cheaper, there is less ability to modify this plan to meet your individual needs. One option some employers offer is to provide a stipend in lieu of health insurance. This allows an employee to purchase a more personal insurance plan.

Catastrophic coverage is another option a person can take to protect themselves from future medical liabilities. Catastrophic medical coverage is less expensive and can be helpful in enhancing a person’s health plan by covering only medical emergencies.

A health savings account (HSA) can be a useful tool in managing medical debt. It is a tax-advantaged medical savings account available to taxpayers who are enrolled in a high-deductible health plan. Funds contributed to an HSA are not subject to federal income tax at the time of deposit. These funds roll over and accumulate year after year if not spent. This approach allows the individual to set aside a certain amount each month in their HSA. These funds can be used to pay deductibles and other health care expenses not covered by your health care plan. A flexible spending account (FSA) is another tool employers offer to help employees manage healthcare costs, but FSAs have significant drawbacks.

Here are some examples people can consider when optimizing their health insurance to protect themselves and their loved ones from medical debt and the threat of bankruptcy. There are many other concerns that a person must consider when planning for a medical emergency, such as loss of income. Medical emergencies are highly unpredictable, and no person is immune to the possibilities of a medical crisis. It’s a good idea to plan ahead for the financial impact of a potential health care crisis.

d. dye