People end up in debt for a variety of different reasons. For example, in recent years, medical costs have become a leading source of personal debt.
People may require trauma care after a car crash, only to learn that the driver at fault for the wreck did not have insurance. They may have cancer or another debilitating health issue that requires treatment that their insurance will not fully cover. They might even get hurt while on vacation or a business trip, meaning they need to obtain out-of-network emergency care that costs them tens of thousands of dollars.
Patients often assume that medical creditors will be compassionate when working with those who have substantial debt. Unfortunately, the opposite is often true. Medical creditors can be among the most aggressive when seeking to compel people into payment. The following are some of the ways that medical creditors can harm a prior patient’s life when attempting to collect on a debt.
They place liens on people’s homes
Research into medical collection efforts in Ohio shows a very frightening trend. More than two-thirds of hospitals regularly sue patients who fall behind on payments or carry a high balance. Medical creditors often seek a lien against someone’s primary residence. That way, an individual cannot sell their home or even refinance their mortgage without first paying what they owe for healthcare in full. Liens can also complicate the descent of ownership after someone dies.
They garnish people’s wages
A successful creditor lawsuit does not always lead to a lien against personal property. Sometimes, creditors instead seek to garnish someone’s wages. The state allows creditors to request of portion of a debtor’s disposable income regardless of their other financial obligations. Wage garnishment often pushes people deeper into debt and makes daily life a struggle.
They sell the debt to private companies
Many hospitals handle collection efforts in house, but others would prefer not to tarnish their reputations through aggressive collection activity. Instead of demanding payment on their own behalf, they sell the debt to an outside collection agency. That agency may sue someone, report the debt to the credit bureaus and engage in collection efforts that feel like harassment.
Medical debt can be very difficult to manage, particularly when people are not able to return to work quickly because of their health challenges. Pursuing personal bankruptcy is a way to both stop aggressive collection efforts and discharge unsecured debts, including most medical debts.