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The ACA may be responsible for fewer personal bankruptcies

Personal bankruptcies throughout America hit their peak in 2005. Since there, there have been 12 straight years of declining rates, and there has been a 50 percent drop since 2010. That year, there were 1.5 million consumer bankruptcies compared to 766,000 in 2016, and there are few signs that this trend will not continue in South Carolina and across the U.S. Many observers say that the Affordable Care Act has played a role in this trend.

Researchers believe that the legislation is responsible for as much as 50 percent or more of the decline. The ACA has worked to keep medical costs down by capping the out-of-pocket costs a person people have to pay. It has also reduced costs by making insurance available through Medicaid expansion and exchanges. A survey from the Centers for Disease Control and Prevention found that the number of respondents saying that they can't buy necessary coverage was at its lowest since the 1990s.

Whether or not medical debt is a leading cause of bankruptcy is somewhat of a partisan issue. A 2009 study found that medical debts were the cause of 62 percent of bankruptcies in America in 2007. However, a 2014 study from a Northeastern University associate professor found that medical bankruptcies made up at most 25 percent of all personal bankruptcies.

If a person is struggling to pay his or her medical debt, it may be a good idea to consider filing for bankruptcy. Past due hospital bills or other balances owed may be either reorganized or discharged immediately. Bankruptcy may be ideal for those who are facing lawsuits or other collection efforts as filing may put at least a temporary hold on these actions.

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