I’m 31. I was diagnosed with cancer in June after two biopsies. Started chemo the same month. Went through 3 months/4 cycles of treatment, and now I’m technically in remission/NED. Looking at about $125,000 in medical debt, and I have no idea what to do. No insurance. Don’t qualify for Medicaid in my state. Living at home with my parents. No job. A few thousand saved from selling my mobile home. Feel like I’m on pause and in limbo.
I’ve been misled by the hospital for months, meaning they know my situation but never seem to give me the full story/are on the same page regarding policy. They have a forgiveness program, but the program just changed its policy in July to not cover special treatments like oncology stuff, so none of my chemo would be covered. I was just told this in October after they’d led me to believe for months that my chemo would be covered. Plus, I moved out of the area (even though I continued treatments at the same hospital), so the forgiveness program will only apply to anything I had done through June when I was living in the county. As of today, it sounds like I could qualify for 100% forgiveness (of non-specialized services) when I apply in December (they keep telling me to wait to apply for their program because the longer I wait the more likely I’ll be to qualify for 100% forgiveness since I’m not working). That’ll only cover about $40,000, so I’m still looking at crippling debt even with the forgiveness program. Debt is already being sent to collections, and the hospital’s financial department says in order to keep a large portion from being sent to collections I need to catch up on minimum monthly payments (about $1000 right now). Otherwise, it’s best to just let it go to collections, qualify for the forgiveness program, and then the hospital will pull my debt back to determine what’s being forgiven and what isn’t. This could take a month or two. After that, I can pay a $300/month minimum payment, interest free, to keep the rest of my debt out of collections. At that rate, I’ll be paying this medical bill for the next 25+ years.
I’ve applied for various programs and grants. Some have been helpful (for a few hundred here and there), others I no longer qualify for because I’m either no longer in treatment or I missed the application deadline window. On top of all this, I feel stronger and like I should be doing something, but I’m technically still in recovery. I know I need to get a job and move out of my parents’ house. I know my job’s going to need to cover my current bills (which I’m still paying somehow with the help of friends and family) as well as medical bills, rent, utilities, and everything else just to break even every month. Starting in December, I’m going to have to start using the money I saved from my mobile home sale to pay my monthly bills. That money is supposed to be for moving on after all this. I’m seriously at a loss. My mom just gave me a number for a bankruptcy lawyer and wants me to call and ask about my options. I know filing for bankruptcy will cost a few thousand dollars (mobile home money), and the bankruptcy will hang over my head for the next 10 years. I don’t want to be forced to file bankruptcy at 31 years old because of crippling medical debt, but the other option is to find a good paying job really soon and pay a minimum monthly (which is equal to my car payment right now) for the foreseeable future. I feel like that’s the adult thing to do. Like that’s the responsible thing to do. I can’t just get cancer, get treated, and expect not to pay my bills. That’s not how life works, and I know that. But I also didn’t ask for cancer. I didn’t expect cancer. I didn’t expect a few months of my life this summer to put me in more debt than I’ve ever been in in my life, and I honestly don’t know how to dig my self out of this hole I’ve fallen into. “Get a job, pay your bills, live life in debt forever. It’s the American way.” I mean, I understand that sentiment, if that’s your advice. I really do. But damn. That’s depressing. That’s not hope for the future…
Comment from Rengler22:
I am not an expert, but I had a parent that was forced to file Chapter 7 due to a serious illness and I did a lot of research on the process and the impact a bankruptcy can have.
I think it’s time to swallow your (understandable/admirable) pride and look very, very seriously into bankruptcy as the people have suggested above. I would have a really hard time imagining a scenario where bankruptcy made more sense than it does here. I’m going to presume, based on your current financial situation / assets, that you were not swimming in money before you were diagnosed with cancer. That leads me to believe that there isn’t some six figure job just waiting for you to re-enter the workforce. Even then, your current situation is that you have virtually no assets (compared to your debt), no job, only semi-recovered from a life-threatening disease, and $125,000 in dischargeable medical debt. I would imagine that you are the poster boy/girl for bankruptcy from the facts you’ve laid out here.
Practically, the advice I would give you is to try to keep things in perspective as you make this decision. The amount of mental and possibly physical anguish you will go through over the next 10, 20, 30 years paying off $125,000 in medical debt dwarfs the consequences of a bankruptcy. At the end of the day, we are talking about a ‘stain’ on your credit history for 10 years upon bankruptcy. In other words, your credit score will take a pretty big hit at first, assuming your credit score is fairly high in the first place. I think a lot of people think a bankruptcy means they won’t be able to buy a house, car, or otherwise live a happy, successful life. That’s simply not true in my experience. While these things might be more complicated/difficult, people are legally permitted to, and frequently do, obtain an FHA mortgage in as little as 2 years after their Chapter 7 bankruptcy is discharged. In your case, having a major medical issue, that time limit would likely be reduced to 12 months by the FHA. FHA loans are typically sought by first time home buyers and people with rocky credit. Conventional loans can be usually be obtained in as little as 24 months. And the impact to your credit score will get less and less as time goes on. Someone with good credit can expect their credit scores to rebound completely within roughly 5 years. The time frame is shorter the worse your credit was to begin with.
Above are some facts/thoughts on the impact and recovery of someone’s credit score that is worth preserving. I’m not even sure that is the case here with you. It sounds like you already have a number of items in collections, which is going to have had an impact on your credit score. While medical collections are now factored into your score to a lesser degree than, say, a credit card collections, they still have a negative impact on your credit score. On top of this, you will likely be struggling to make payments across all of your bills if you attempt to pay this off for the next 20 years. It’s very possible that this will cause you to miss payments, have things go to collections, etc. throughout this entire duration unless something pretty significant happens in your favor. You very well could get to the end of paying this off and have a terrible credit score, which is what you’re agonizing over at the thought of bankruptcy. Instead, you could have fully restored your credit score and have zero debt in as little as 5 years. Make on-time payments, start building your credit score with a secured credit card, and you will have no trouble obtaining credit with a little work. The loans might be a bit more expensive (higher interest rate) for a period of time, but it pales in comparison to the amount of money you’re looking at with these medical bills.
On a personal level, it sounds like you’re struggling with the idea of bankruptcy and what that means about you as a person. As mentioned, it’s admirable that you want to do the “right” thing and pay off these debts. While I understand your thought process, especially after having agonized alongside my very proud father throughout this process, you should know that your credit score doesn’t define your character. And while it’s not my place to judge people who declare bankruptcy following a lengthy string of unwise / irresponsible financial decisions, I think it’s important that you acknowledge the distinction between your situation and theirs. You didn’t run up your credit cards or buy a 7,000 square foot house. It wasn’t due to luxury cars and a lavish lifestyle. You got cancer. You needed treatment so you went and received that treatment, cost be damned, as well you should have. No amount of money is worth dying over. Having the privilege (/s) of receiving chemotherapy does not warrant being sentenced to a life of poverty and unending struggle if it can be avoided. And it can, via bankruptcy. You will have a completely fresh start financially and this will be a distant, albeit uncomfortable, memory in a much shorter time frame than it would be if you were to carry this debt until it is paid off.
As I think the personal motivations for you are stronger than those related to your credit score, I’ll type even more words than I already have! Avoiding any political conversations like the plague, I would point out to you that if you were born north of the border, across the pond, or many other places, you never would have even thought to make this post. Your medical care would be covered by the government/taxpayers and you’d be at home focusing on your recovery from cancer, without a second thought as to how long you’d be paying off your chemo drugs. The USA is a different country with unique challenges, obviously, and regardless of which side you fall as it pertains to universal healthcare, you should take solace in the fact that no one thinks cancer patients in Canada or Europe are terrible people for not having forked over the equivalent of a mortgage on a 4 bedroom house in the Midwest.
You’ve been dealt a really shitty hand thus far having gone through cancer/cancer treatments. As a random internet stranger, I hope you can take a step back and strongly consider taking the break that you are allowed by law. Whoever wrote the bankruptcy laws, I can’t help but imagine they envisioned someone like you getting a fresh start after an extremely unfortunate life event that led to devastating financial consequences.