| A recent study looked at the suggestion that | | | | despite their inclusive healthcare program, there |
| bankruptcy rates in the US could be dramatically | | | | are two things we can surmise. One is that, |
| reduced if a better health care system were in | | | | indeed, healthcare costs in the US, while high, are |
| place in America. While it is true that personal | | | | just another of the many contributors to |
| bankruptcy rates in the United States have | | | | bankruptcy rates. In other words, it would be just |
| soared since the economy started to deteriorate, | | | | as "easy" to become bankrupt by racking up |
| the myth that health care costs are the driving | | | | credit card debt as it is to incur steep medical |
| factor is just that: a myth. | | | | expenses but the bottom line would be the same: |
| According to a recent study by Brett Skinner and | | | | income cannot support debt levels that individuals |
| Mark Rovere, health care costs that are paid by | | | | incur. |
| the user do not impact bankruptcy filings. That is | | | | The second assumption is that the systems by |
| not to say that high medical costs do not | | | | which individuals file for bankruptcy are very |
| contribute to bankruptcy filings, but overhauling | | | | different in both countries. For example, it may |
| the US Medical system alone will not have a | | | | simpler for people to file in Canada versus the |
| tremendous impact on bankruptcy. | | | | United States and the consequences of filing |
| The reason for bankruptcy is quite simple and | | | | might be lighter in Canada versus the United |
| obvious (once revealed). And that reason is lack | | | | States. However, this does not seem to be the |
| of income and savings. The study points to | | | | case aside from one simple distinction. |
| Canada as an illustration that bankruptcy rates | | | | In Canada, Chapter 13 bankruptcy is referred to |
| and assisted or paid medicare are not linearly | | | | as a consumer proposal. A consumer proposal |
| related. In fact, personal bankruptcy rates in | | | | allows for forgiveness on part of the consumer's |
| Canada were roughly 10% higher in the past two | | | | unsecured credit debt; in the US, Chapter 13 |
| years. It is interesting to note that Canada has an | | | | wipes out unsecured credit debt. |
| assisted healthcare program that is so inclusive it | | | | Ultimately, while medical costs are often cited as |
| is virtually paid for, yet their bankruptcy rates are | | | | a reason for declaring bankruptcy, it is not the |
| quite a bit higher. | | | | root cause. Lack of income is. |
| If Canadian bankruptcy rates are so much high | | | | |