When it comes right down to it, most people don’t have any idea how much they spend on health care. When you’re filing for bankruptcy, one of the forms or schedules that must be completed is a budget. When the discussion of bankruptcy gets rolling, it’s hard to get very far without talking about a budget. Bankruptcy attorneys will be the first to tell you that while a lot of people don’t have a clear-cut budget, the most common problem area is health care. No one seems to actually know how much they spend on health care.
According to the US Trustee, the federal agency that oversees the bankruptcy system, the average budget for health care is $60 per month per person. Many respond to this “average” with the opinion that it is high, but when the costs of health care are actually considered, it is too low for many who are filing for bankruptcy.
Determining Your Health Care Costs for You “Budget” When Filing Bankruptcy:
When you put together your budget, take some time to determine your health care costs. You may be overlooking trips to the dentist, the orthodontist, the purchase of eyeglasses and/or contacts, etc. Highlights of a study issued by Centers for Medicare & Medicaid Services indicate that monthly averages of health care expenses are drastically higher. As of 2014, the average per person per month is closer to $794. These average costs include: what is covered by health insurance, care for the seriously ill, accident victims, and care for the elderly. But even with these included, there is a drastic difference between the average health care costs as determined by CMS in comparison to the average monthly health care costs according to the US Trustee.
In fact, having considered this information (and combining it with the related issue of time lost from work due to health care needs), it’s not surprising that the financial costs associated with health care is one of the biggest causes of bankruptcy. This is particularly true in cases where the individual has a greater number of dependents (children, elderly parents, etc.) Yet even families in these situations who obviously have a lot of health care related costs will put down $25 for their average monthly health care costs when they fill out their budget schedule for bankruptcy.
This discrepancy between what bankruptcy filers spend on health care and what they state they spend on health care on the bankruptcy’s budget schedule is often the problem for petitioners whose calculations indicate they have “extra” money each month, but who actually live paycheck to paycheck with credit supplementing their costs. They simply aren’t aware of how much they are spending on health care.
If you feel that you need more assistance determining your budget for your bankruptcy filing, please get in touch with the experienced southern California bankruptcy attorneys at Westgate Law. We can help you determine which areas you may be underestimating.