High Medical Costs Push Many Americans into Credit Card Debt ...

As medical costs continue to rise at an exponential rate, more and more Americans are being forced to pay for health care with their credit cards. And this trend is threatening to drown hundreds of thousands of people in credit card debt.

The average American household holds almost $2,000 in credit card debt that is directly attributable to medical costs, according to a report from the Huffington Post.

This statistic helps explain why more than a million Americans sought debt relief by filing for Chapter 7 bankruptcy last year.

Medical Costs Lead to Credit Card Debt

The Huffington Post recently offered some staggering statistics that reveal the unsustainable costs of medical care in the United States:

• Credit card debt. Among 1,000 adults surveyed by Davos, a research and policy center, the average cardholder had $7,145 in credit card debt. Of this sum, an average of $1,678 was owed to health care providers. Remarkably, almost 50 percent of households surveyed had used their credit card to pay for out-of-pocket medical expenses.
• Rising costs of care. The rapidly inflating cost of medical care threatens to make this trend even worse. Sources say that, in 2011, the cost of health care rose almost 6 percent, far outpacing the rate of inflation. And the average family with job-based health insurance will spend $20,000 on health care this year, which is roughly 40 percent of the average family?s income.
• Lack of insurance. In addition to the rising costs of care, more and more Americans are unable to afford health insurance. Last year, more than 25 percent of people between the ages of 16 and 64 did not have health insurance at some point during the year. Without insurance, many of these people were forced to use credit to pay for necessary medical care.

Chapter 7 Bankruptcy and Credit Card Debt

As mentioned above, hundreds of thousands of families with credit card debt have turned to Chapter 7 bankruptcy to address their debt problems.

In Chapter 7, filers may be able to eliminate some or all of their unsecured debts, including overdue credit card payments and overwhelming medical bills, as well as other debts like payday loans or utility bills.

Of course, the outcome of each case depends on the unique nature of each individual filer?s debt problems. Nevertheless, many people have found welcome relief in bankruptcy court.

For more information on Chapter 7 bankruptcy, or other debt relief strategies, contact a local bankruptcy lawyer today.

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