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Ramifications of medical and credit card debt in Pennsylvania

The subject of whether credit card debt or medical debt is worse can come up often among consumers. Approximately 43 million consumers in the U.S. are dealing with some medical debt on their credit reports. Both types of debt have their own particular implications. Credit card debt, however, has more of an impact on a consumer's overall credit score than medical debt.

The Consumer Financial Protection Bureau reported that average American households are carrying $15,611 in total credit card debt each. In the area of interest, credit card debt is definitely worse. Credit card accounts generally accrue interest at a higher rate than medical debt does, especially when consumers pay only the minimum monthly payment. The only exception is a zero percent interest credit card. Some medical debt may incur interest, but a number of hospitals offer payment plans with no interest.

Medical debt is more difficult for consumers to control because they have no way to predict the timing of an illness or injury nor the overall cost. Negotiating medical debt, however, is easier than doing so with credit card debt. An estimated 80 percent of medical bills contain some errors, which could result in successful negotiations with the creditor. Collections on medical debt could be worse because medical bills comprise approximately half of all total bills that go to collection agencies, according to the CFPB.

When consumers find themselves buried in either credit card or medical debt, the situation may seem out of control, and they could be in need of assistance with debt management. A bankruptcy attorney may be able to help them with negotiating the debts, dealing with creditors and choosing the optimal method for getting the debt under control.

Source: NerdWallet, "Medical Debt vs. Credit Card Debt: Which is Worse?", Lindsay Konsko , Jan. 5, 2015

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