What Happens

• A person finds himself in a bad medical situation. This can be an illness, accident or surgical procedure. He begins to get bills from the hospital. When he can't pay the bills on time, they go to collections. Interest and fees begin to accumulate. Eventually, he is so deeply in debt that he can't pay his other obligations. At this point, there is no way out. He is forced to file bankruptcy.
  
  

Why it Happens

• The most common reason medical debts put a person in this position is insurance, or lack thereof. Procedures, medicine and treatments cost an exorbitant amount of money, even with insurance. A person without insurance (or who is underinsured) may not be able to pay them. He will have to dip into savings if possible, and even then, the cost may be too much. Eventually he won't be able to pay and will be on his way to bankruptcy.
  
  

How to Avoid It

• A person should do everything he can to stay healthy, but there are no guarantees. Unforeseen illnesses and accident are a part of life. Since injury or illness can't always be avoided, you should have insurance. Many people are insured through their employers. Unfortunately, people can lose jobs and have difficulty finding new ones. If a person ends up in a situation where, despite everything, he can't pay his medical bills, bankruptcy will be his only viable option.
  
  

Other Factors

• Severe medical debt may not be the only contributor to a bankruptcy situation. In many cases it may be the last element to push a person over the edge. If an individual is saddled with $50,000 in credit card debt and faced with a $7,500 medical bill, the medical bill is a contributor, but not the major cause. Maintain good credit, pay your bills on time and save to prepare for unforeseen occurrences in order to avoid bankruptcy.