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Caring for family members may lead to financial issues

On Behalf of | Jul 31, 2021 | Chapter 13 Bankruptcy, Chapter 7 Bankruptcy |

Medical emergencies often require taking time off from work to provide care for a spouse, parent or child. Under the Family and Medical Leave Act, employees can take up to 12 weeks off for caregiving and keep their jobs. Many companies, however, do not provide pay under these circumstances.

Even with health insurance, out-of-pocket expenses can add up quickly, especially when a family’s income decreases. Research conducted by the AARP discovered that the majority of family caregivers paid out-of-pocket expenses averaging about $3,400 so that a relative could receive medical care. This amount excluded any related legal or travel expenses.

Unexpected out-of-pocket health care costs

When caring for a parent over the age of 50 who lives at least an hour away, researchers found that a caregiver could spend more than $12,000 in 2019. To provide the assistance, individuals cut back on their own personal expenses, such as by reducing their grocery bills.

A caregiver taking a leave of absence from work may need to cover co-payment costs for expenses other than a family member’s prescriptions and health care visits. Medical devices such as in-home testing kits and portable oxygen concentrators may bring unexpected out-of-pocket costs.

Overwhelming medical expenses and financial hardships

Without ample savings, many caregivers turn to high-interest personal loans or credit cards to pay for unexpected medical costs. As reported by Health.com, 79 million U.S. adults had issues paying bills and debts related to medical care. While some medical providers may offer a payment plan, an unpaid bill may find its way to a debt collector in about six months.

Individuals experiencing financial hardships related to unexpected medical emergencies may consider bankruptcy as a means of resolving unmanageable debts. By filing a petition, the automatic stay often stops the debt collection process, including unpaid medical bills.