April 16th, 2009 by Reed Allmand 
We often mention on this blog that medical debt is one of the leading causes of bankruptcy in America. But there is another problem not often talked about that causes millions of Americans to unwittingly rack up medical debt–inadequate health insurance. Millions of Americans are signed up for health insurance policies that offer inadequate coverage. Just when they need the insurance benefits because of a catastrophic illness, they find that many of the procedures they require are not covered by their barebones health insurance policy. Of course the get the procedures anyway and end up in thousands, sometimes hundreds of thousands of dollars in medical debt.
Is your health insurance policy adequate? Ask yourself the following questions and find out if your health insurance is likely to put you into medical debt not keep you out of it:
- Does your health insurance have low overall health coverage? Medical care is VERY expensive so if you have a policy that is only covering you for a few hundred thousand you could be setting yourself up for a medical debt catastrophe if you ever faced a serious illness.
- Does your health insurance policy omit care for important items such as prescription drugs or outpatient chemotherapy? If so, this is another pitfall in your health insurance that could cause you to rack up tens of thousands of dollars in medical debt.
- Does your health insurance policy fail to place a maximum on out-of-pocket expenses? Many barebones health insurance policies have no limit on how much you’re required to pay out of your pocket a year, which can send you into bankruptcy if you ever become seriously ill.
Yes, medical debt can be discharged in bankruptcy; but there are some things you can do now to avoid the medical debt trap. If you’re paying for a medical insurance policy make sure that you are properly covered. Visit Comsumer Reports – Health Insurance Overview to find out more about how your health insurance policy may be setting you up for a medical debt trap.
About Reed Allmand
Allmand's vision is rooted in his own financially precarious childhood in Abilene "My father always had difficulty holding a job and supporting our family, so after my parents divorced when I was 12, my sister and I got jobs to help make ends meet," he recalls. "I remember what it felt like as a child to worry that our car would be repossessed or home foreclosed on."
View all posts by Reed AllmandSubscribe
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