There are many different types of debt people can accumulate, and it is quite common for people to have different attitudes toward different types of debt. For example, people generally recognize that payday lenders, car loan companies that specialize in bad credit financing and even many credit card companies will become very aggressive if someone starts missing payments.
However, given that hospitals are in the business of curing people, there is often an expectation that they will be more compassionate in their approach toward debt collection. It may only be when someone has fallen behind on significant medical debts that they realize just how aggressive hospitals can become while collecting on medical debt in Alabama.
They may place a lien on future recovery
Medical debt can result from all kinds of different situations, including car crashes caused by people with bad insurance or injuries on the job. Their medical debt isn’t their fault, but they are still accountable for it. Hospitals in Alabama have statutory protection that allows them to seek a lien against any future recovery a patient receives related to workers’ compensation, car insurance or even personal injury lawsuits. People may then make major efforts to connect with compensation, only to have it all go immediately to their medical creditors.
They can take someone to court
Although stress is known to have a negative impact on people’s physical and mental health, that knowledge does not prevent hospitals from engaging in very stressful collection efforts against people that their physicians have previously treated. Debt-related lawsuits can sometimes result in liens against personal property or the courts ordering the garnishment of someone’s future wages. Once there are such leans or garnishment orders already in place, it can be very challenging for someone to change their circumstances.
A bankruptcy filed prior (or even after) to hospitals taking someone to court or seeking a lien against their recovery efforts could protect a filer from those collection efforts and discharge their medical debt if the bankruptcy filing is successful. Those who recognize that medical creditors can be as ruthless as private financial companies may feel more comfortable filing for bankruptcy when the majority of their debt stems from medical care.