With bankruptcy filings down 50 percent from seven years ago, many Americans may attribute this decline to factors such as America’s rebound from the recession in 2008, however Fox News notes that a more significant reason is the decline in unmanageable medical debt due to the Affordable Care Act:
Bankruptcy and legal experts agree on this: Medical bills had been a leading cause of personal bankruptcy before health insurance expanded under the ACA. Medical bills are often unexpected and large and unavoidable, so people who don’t have insurance can run up massive debt in a relatively short period of time.
Since 2010, personal bankruptcy filings have dropped by about 50%. Experts say some of that is due to an improved economy and laws passed in 2005 that make it harder to declare bankruptcy. But nearly all the experts CR interviewed also point to expanded health insurance as a major driver of the decline.
With the Affordable Care Act’s extension of coverage for patients with pre-existing conditions, many Americans have been able to afford to pay for healthcare. In the coming years under a possible new health care law, bankruptcy filings may increase yet again.