Medical Debt Attorney in Howell, New Jersey

Medical debt is a pervasive problem impacting millions of individuals and families in the United States. According to the Peterson-KFF Health System Tracker, approximately one out of every ten adults with incomes below 400% of the federal poverty level (FPL) carries some form of medical debt.  

For many Americans, dealing with this type of debt can cause significant financial difficulties and even lead to bankruptcy. In fact, medical debt is the leading cause of bankruptcy in the United States, according to the American Bankruptcy Institute.

If you're dealing with overwhelming medical debt and are considering bankruptcy as a solution, you aren't alone.  

Fedoroff Firm LLC understands the challenges medical debt can cause and is committed to helping its clients understand the options available for debt relief.

Located in Howell, New Jersey, Fedoroff Firm LLC serves clients throughout Jackson Township, Wall Township, Brick Township, and Freehold Township 

Bankruptcy Options for Medical Debt 

If you or a loved one is dealing with significant medical debt, there are options to help you manage your debt and work toward rebuilding your financial standing. One primary option is filing for bankruptcy, specifically Chapter 7 and Chapter 13 bankruptcies. 

Chapter 7 Bankruptcy 

For individuals unable to manage their medical debt, Chapter 7 bankruptcy might be the best path toward financial freedom. This type of bankruptcy, also known as "liquidation bankruptcy", is designed to eliminate most of your unsecured debts, including medical bills.

This process typically involves liquidating your non-exempt assets to pay off creditors. 

Under Chapter 7 bankruptcy, New Jersey allows you to retain some assets, such as your primary residence, vehicle, and certain personal property. To qualify for Chapter 7 bankruptcy in New Jersey: 

• Your monthly income must be below your state's median income. 

• Your disposable income must be low enough to pass the state's means test. 

• You cannot have filed for bankruptcy in the past six years. 

• You cannot have had a bankruptcy dismissed for not appearing in court. 

Chapter 13 Bankruptcy 

Chapter 13 bankruptcy, also known as "the wage earner's plan", is another option for individuals struggling with medical debt. Unlike Chapter 7, this type of bankruptcy involves creating and adhering to a repayment plan over three to five years.

This allows you to pay off your debts gradually while protecting your assets from liquidation. 

Filing for Chapter 13 is often more suitable for individuals with a higher income who don't qualify for Chapter 7. To qualify for Chapter 13, you will need to meet the following criteria:   

• Maintain a steady income that will allow you to make regular payments. 

• Have previously completed Chapter 13 bankruptcy for a minimum of two years, or Chapter 7 bankruptcy for a minimum of four years.  

• Have submitted your most recent tax returns. 

• Make sure your unsecured debts do not exceed the federal limit of $419,275, and your secured debts do not exceed $1,257,850.  

Filing for bankruptcy for your medical debt is often a compleicated process, which is why it's important to seek help from an experienced bankruptcy attorney.

At Fedoroff Firm LLC, Attorney Vera Fedoroff has over 20 years of experience helping her clients with their debt relief needs. 

Alternatives to Bankruptcy 

While bankruptcy is a primary option for managing medical debt, it's not the only solution. Other potential options include: 

• Verifying your debts: Check that your medical bills are accurate and legally owed. The No Surprises Act shields you from many unexpected charges and prevents private insurers from charging additional costs for emergency services. 

• Consulting with a medical billing advocate: Medical billing advocates are experienced with identifying and correcting errors on your bills. Duplicate charges and mistakes can happen, and a medical billing advocate can help negotiate with insurers on your behalf. 

• Enrolling in financial assistance programs: Numerous organizations and nonprofits offer financial aid or debt forgiveness programs to help with paying bills. Nonprofit hospitals often offer indigent care and charity programs, which provide free or low-cost medical treatment. 

• Seeking insurance counseling: Organizations like SHIP provide support with Medicare-related issues, while Veterans Affairs can help with debt counseling for medical expenses. 

• Setting up payment plans: Many healthcare providers are willing to set up repayment schedules, allowing you to pay your medical bills over time without resorting to collections.  

Medical Debt FAQ 

Q: Do I need an attorney to file for bankruptcy? 

A: While you can file for bankruptcy without representation, it is not recommended. An experienced bankruptcy attorney can guide you through the process and provide you with the knowledge and guidance you need to work toward regaining financial stability. 

Q: How long will bankruptcy stay on my credit report? 

A: While filing for bankruptcy can provide much-needed relief from medical debt, it will have a long-term impact on your credit. A Chapter 7 bankruptcy will remain on your credit report for up to ten years, while a Chapter 13 bankruptcy may stay for up to seven years. 

During this time, securing new credit or loans may be challenging and come with higher interest rates. It's crucial to weigh these consequences and explore alternative options before filing for bankruptcy.  

Q: What happens to my medical bills if I file for bankruptcy? 

A: Filing for bankruptcy puts an automatic stay on most collection actions, including medical debt. This prevents creditors from taking any further action to collect payments while your bankruptcy case is in progress. Once your bankruptcy filing is completed, any existing medical debt will likely be eliminated.