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Would the new health care bill lead to more medical debt?

As the new health care bill slowly makes its way through the legislative process, many people in Tennessee are concerned about how their health care options could be affected if major changes take place. This is a deeply personal issue, because health care and the associated costs are different for everyone. For many people, medical debt is a serious risk, even with insurance coverage. If that coverage was lost, then financial turmoil could be just an accident or illness away.

Experts have different opinions on what might happen if the revised health care bill were to pass into law. Some believe that the proposed cuts to Medicaid would leave as many as 16 million Americans without the coverage they depend on. That could prompt an uptick in personal bankruptcy filings in the years to come.

Some consumers would likely try to manage their debt before they sought bankruptcy protection. That could go on for quite a long time, and years could pass before an individual comes to terms with the fact that paying down excessive medical debt is simply not feasible. It is not uncommon for individuals to seek bankruptcy protection only after years of struggling to pay down their growing debt.

That approach is flawed in a number of ways. For one, a great deal of credit damage can occur while an individual tries to pay down debt. While personal bankruptcy will also lead to credit damage, that damage can be repaired fairly swiftly. Also, struggling to pay down high levels of medical debt can make it hard to cover the basic cost of living, which puts a burden on Tennessee families. In many cases, it makes more sense to look at the full scope of medical debt, and make a decision to file for bankruptcy in the months that follow a serious medical event.

Source: Time, "The Senate Health Care Bill Could Lead to More Personal Bankruptcies", Jennifer Calfas, June 26, 2017

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