2 years down, but now in Medical colections

[alorth]

Its been a rough year.

We are still making the payments on plan, mainly as we have no choice since they are automatically deducted.

However, I had a lot of medical issues last year and now owe various Doctors, Hospitals, and Labs a total of about $2000, and they are all at the point where they've been sent to Collections.

As some long timers here know, my plan is weird. We were paying off 2 401k loans when we started the Plan, then there was a step when they were paid off, however, also written into the Plan was that I was allowed to take out another 401k loan to cover a necessary surgery after the first 2 401k loans were paid off.

The proposed payment for the new 401k loan that was to be for the surgery was about $400/month. This was on top of the $1000+ we pay for our Chapter 13 Plan payment.

Well, we never took out the new 401k loan because taxes went up significantly (@$200/month) in January of 2013. So consequently, there was no way to afford the $400 monthly repayment on the amount needed for the surgery.

We kept the extra $200/month left after paying the $200 extra per month in taxes and kept it separate, then asked our attorney what to do...meaning should we file an amended plan and pay the extra $200 in? Our attorney said "no", but keep the money so if "something happens" where there is an audit, and this difference is discovered, then the money can be paid back, but of course the Court would also have to acknowledge that taxes went up by that $200/month, so they should not expect the full $400/month to be re-paid, but only the $200/month.

I know it sounds confusing.

Well....now last year happened. I started having the medical issues, and though we do have insurance, we still had to pay deductibles and co-pays and those have reached about the $2000 I mentioned before, and are now sent to collections.

I don't know if we should take that $200/month that we have been putting aside and use it to re-pay these medical bills. We are living as if that $200 doesn't exist....meaning things are very tight on our budget and we have no room otherwise to pay these bills.

We have car repairs being put off, house repairs being put off, I haven't bought clothes in like 5 years, and I'm wearing shirts with holes in them. I am afraid to look for a job, because I know we will have to file an amended Plan if I get one. I am going stir crazy in this house and have no purpose in life, despite trying to fill some time volunteering at the school for up to 3 days a week.

If we go to the Court or our attorney, there will be new fees. I also fear that the TT, who is very tough, won't care about the $200/month tax increase and will simply try to dismiss the case altogether because I never got the surgery which was stated in the Plan, EVEN THOUGH WE COULDN'T AFFORD THE SURGERY BECAUSE OF THE TAX INCREASE!!!

This is all very frustrating and let me tell you, I am completely miserable in this Chapter 13. If I could go back to 2009, I would have let the house go to foreclosure and paid the credit card debt, and never done a bankruptcy at all. We would have had plenty of money to pay everything if we had let the house be foreclosed, and hell, everyone was essentially doing it. The Government even makes excuses for it.

This Chapter 13 is the BIGGEST mistake of my life. I have no idea how we're getting through the next 3 years, and I just have this over-riding fear that the case will be dismissed somehow, because its such a screwy Plan and I never got the surgery, again because it couldn't be afforded with the tax increase.

Chapter 13 SUCKS. I HATE this.

[LadyInTheRed]

You need to talk to your attorney. If your medical expenses are more than what was budgeted in your plan, then you would be justified using the $200 a month you have been setting aside on the medical expenses.

I also fear that the TT, who is very tough, won't care about the $200/month tax increase and will simply try to dismiss the case altogether because I never got the surgery which was stated in the Plan, EVEN THOUGH WE COULDN'T AFFORD THE SURGERY BECAUSE OF THE TAX INCREASE!!!

It isn't up to the trustee whether to care about the $200. If push comes to shove, that would be up to the judge to decide. I bet your attorney will tell you to go ahead and use the money to pay your medical bills.

[dmc-2008]

Sounds like a rough ride and I hope you can modify somehow. Good luck!

[Pandora]

Ugh medical bills suck - been there done that and still doing it I feel for ya alorth!

We ran into medical situations late last year and I'm currently paying on 5 separate dr bills, who all want a minimum of XX a month, which is more than we could pay given I have a budget of XX the Ch. 13 allows for medical. Luckily they were understanding and worked with us below what they wanted and we're managing, but its hard. We've just paid off 1 and have now rolled that payment onto the next lowest amount owed. Again we were lucky because we had understanding billing supervisors who know that a Ch. 13 isnt any fun and we have what we have to work with, so waived their normal so-many-months timeframe allowance to pay it off so long as we are never late in our payments.

Had you been paying on these medical bills prior to them going to collections? Usually you can work something out with the billing / financial dept so long as you speak directly with the supervisors and explain your situation. If you didnt, and just didnt pay and they went to collections, then you may not have a leg to stand on if / when you have to go to court.

I agree with LITR - use that extra $200 and get those paid as soon as possible - that way it not only will free up whatever extra money you're paying towards medical faster, but it will give you back that $200 faster as well.