Can you file bankruptcy on medical bills? Yes, you really can wipe out medical bills with bankruptcy. Here’s the simple truth about Chapter 7 and Chapter 13, new 2025 numbers, real people’s stories, and five easier ways to fix medical debt first.
Hey friend, imagine getting a hospital bill for $47,000 after a scary car accident. The phone won’t stop ringing, letters keep coming, and you feel sick all over again. You’re not alone, and there is hope. Let’s talk straight about whether you can file bankruptcy on medical bills and if you really should.
3 Big Things You’ll Learn Today
- Medical bills almost always get erased in bankruptcy.
- Two kinds exist: Chapter 7 (fast wipe-out) and Chapter 13 (payment plan).
- Many people fix medical debt for free without ever filing bankruptcy.
Yes – Medical Bills Can Vanish in Bankruptcy
Medical debt is “unsecured,” just like credit card debt. That means in both Chapter 7 and Chapter 13 you can usually get rid of 100% of hospital, doctor, and ambulance bills. Courts see sickness as something nobody plans.
Chapter 7 vs Chapter 13 – Super Simple
- Chapter 7: Takes 3-4 months, wipes everything clean, then you start fresh.
- Chapter 13: You pay back a tiny part over 3-5 years and keep more stuff if you earn decent money.
Shocking 2025 Numbers
Even in 2025, over 530,000 families still file bankruptcy because of medical costs. The average medical debt in those cases sits between $22,000 and $45,000. That’s real life for teachers, nurses, and truck drivers—not just “broke” people.
How Chapter 7 Wipes Medical Bills Super Fast
You file, the court hits pause on all collectors the same day (they must stop calling), and 90-120 days later the judge says the bills are gone forever. Most people keep their house and car because every state has protection rules.
When Chapter 13 Makes More Sense
If you earn too much for Chapter 7 or want to save a house that’s behind on payments, Chapter 13 lets you pay pennies on the dollar. Many pay back only 5-10% of the medical bills and the rest disappears.
Real Stories from 2024-2025
Sarah from Ohio got cancer treatment bills over $180,000. Chapter 7 erased every penny; she kept her little house and started over. Mike in Texas owed $38,000 after a heart attack. He chose Chapter 13, paid $220 a month for four years, and the remaining $30,000 vanished. Grandma Lisa’s Medicare gap left her with $19,000 in bills. The hospital wrote it all off once she asked for charity care—she never needed bankruptcy.
Pros and Cons – No Sugarcoating
Pros
- Collectors stop calling the day you file
- Bills disappear forever
- You get a true fresh start
Cons
- Chapter 7 stays on your credit report 10 years
- Chapter 13 stays 7 years
- Friends might see it if they search public records
Five Easier Ways to Fix Medical Debt First
Before you ever think bankruptcy, try these most work great in 2025:
- Ask the hospital for charity care Many wipe out 100% if your income is under 400% of poverty level.
- Use the No Surprises Act New 2025 rules stop giant surprise bills from out-of-network doctors.
- Call a non-profit medical bill helper Groups like Dollar For fix bills for free.
- Set up a 0% hardship plan Hospitals often freeze interest and lower payments to what you can afford.
- Try debt settlement Pay 30-50% in one lump and the rest goes away—no bankruptcy needed.
Simple Steps If You Really Need to File
- Do the free credit counseling (takes one hour online or phone).
- Gather pay stubs, bills, and bank statements.
- Pay the court $338 for Chapter 7 or $313 for Chapter 13 (or ask to pay in installments).
- Go to one short court meeting (usually on Zoom now).
- Get your discharge letter—bills are legally gone.
How Badly Does It Hurt Your Credit?
You’ll drop 100-200 points at first, but most people are back over 600 within two years if they pay new bills on time. Ten years sounds forever, but life moves fast.
When You Should NOT File Bankruptcy for Medical Bills
- The bills are small (under $10,000) and not in collections yet.
- You qualify for hospital charity care (most people do).
- You’re about to retire and need perfect credit for a mortgage.
Quick Comparison Chart
- Charity care: Free, no credit hit
- Hardship plan: Low payments, no credit hit
- Debt settlement: Pay less, small credit hit
- Chapter 7: Everything gone, big credit hit 10 years
- Chapter 13: Pay little, smaller hit 7 years
Your Next Step Today
Pick up the phone and call the hospital billing office. Say, “Do you have financial help or charity care?” Nine times out of ten they’ll lower or erase the bill. If they say no, call a free non-profit counselor at 1-800-388-2227 (National Foundation for Credit Counseling). Only after those two calls should you even think about bankruptcy.
You’ve got this. Medical bills feel huge, but they don’t have to ruin your life. Start with the easiest fixes—you might be shocked how much disappears for free.
Frequently Asked Questions (FAQs) Can You File Bankruptcy On Medical Bills
Can medical bills really be erased in bankruptcy?
Yes, almost 100% of the time. Medical debt is unsecured, so Chapter 7 wipes it clean and Chapter 13 lets you pay little or nothing. Courts understand sickness happens to good people.
Will I lose my house if I file bankruptcy over medical bills?
Almost never. Every state protects a certain amount of home equity. Most people keep their house, car, clothes, and retirement savings.
How long does medical bankruptcy stay on my credit report?
Chapter 7 stays 10 years from the filing date. Chapter 13 stays 7 years. Scores usually bounce back strong in 2-3 years with good habits.
Is there a minimum amount of medical debt needed to file?
No minimum at all. People file with $8,000 or $800,000. It only has to feel impossible for you right now.
Can hospitals still chase me after I file bankruptcy?
No way. The second you file, an “automatic stay” freezes all collection calls, letters, lawsuits, and wage garnishments.
Are there new 2025 laws that make medical debt easier to fix?
Yes! Expanded charity care rules, stronger No Surprises Act protections, and many hospitals now must offer 0% plans make forgiveness easier than ever before.