Filing bankruptcy does wipe out medical debt. When filing a petition, the debtor is required to list all debts and creditors, this includes medical debt and doctors. A Chapter 7 bankruptcy permits unsecured debts, such as medical bills, to be discharged.
A legitimate and common concern is the possibility of a person losing a doctor if they file bankruptcy to discharge medical debt owed.
In an emergency medical situation, regardless of insurance status or the ability to pay, everyone is entitled to initial treatment. A federal law called the Emergency Medical Treatment and Labor Act states that anyone who seeks medical attention at emergency department shall be stabilized and treated.
Can your medical treatment be terminated if you file bankruptcy on your doctor? If you owe your doctor money, and you are required to list that debt in a bankruptcy, you may not necessarily have to find a new physician. One recommendation would be to contact the doctor before filing bankruptcy. It would be appropriate to discuss your intent to file bankruptcy with the doctor to explain your situation. A payment arrangement could possibly be worked out with the doctor’s office, even though the money owed would be listed and erased in bankruptcy.
Often, clients find that the doctor is willing to work with them by accepting payments over time. Also, any insurance coverage that applies may still have to be paid to the doctor, even with the bankruptcy filing. Sometimes a doctor will write off the debt, and continue services with a patient. Other times, doctors have refused further appointments with a patient or don’t offer payment plans.
It is also common that a patient changes doctors because of insurance coverage, not because they have medial costs owed to the doctor. The point is, this situation is fairly common, and if your physician will not work with you, in order to take care of your financial debt relief, you simply may have to change doctors.