Father Grapples with What to Do After Teen Daughter’s Mental Health Treatments Lead to $400K of Debt

1George Kamel and Rachel Cruze on ‘The Ramsey Show’Credit: The Ramsey Show/YouTubeAn Indiana father of four having ‘big issues with money’ seeks advice from ‘The Ramsey Show’ financial expertsNEED TO KNOWAn Illinois father is trying to figure out how to handle $400,000 in medical bills for his daughter’s ongoing mental health treatment

He turned to financial experts on The Ramsey Show for ideas on financial assistance and negotiating the medical debt

During the podcast, they also addressed the ways he and his fiancée could bring in more income

A father of four from Indianapolis is facing roughly $400,000 in debt tied to his teenage daughter’s mental health treatments.

On the Sept. 16 episode of The Ramsey Show, Jonathan, 33, turned to George Kamel and Rachel Cruze for guidance as he weighs how to handle the mounting bills while disability income and part-time earnings leave little room after monthly expenses.

“I’m just trying to figure out if I need to file bankruptcy or try to pay it off a little bit at a time,” Jonathan said on the podcast. “She’s 14, so there’s still another four years of hospital stays and other things coming our way, and it’s going to be more and more and more.”

During the episode, Jonathan told the hosts he has been unable to work for about 10 months after breaking his hip and currently receives about $1,500 a month in disability. His fiancée, who has been helping care for him, brings in roughly $2,000 a month from a part-time job.

Together, they have about $3,500 in monthly income, while their bills, including rent and vehicles, are also around the same. On top of the medical debt, Jonathan told Kamel and Cruze he has about $50,000 in credit card debt and another $10,000 in car loans.

With the medical bills already in collections, Jonathan was unsure how the family could possibly manage the $400,000 balance, especially with more treatment potentially ahead.

Kamel said having a clearer picture of future costs would make it easier to plan, but warned that “if it’s just this unlimited black hole that we’re going to just spend hundreds of thousands of dollars, it’s going to be hard to climb out.”

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Cruze, however, raised the possibility of negotiating the medical debt rather than assuming the full amount would have to be repaid. She also suggested that having some money available could potentially help when dealing with providers or collectors.

“Medical debt is one that can be very much negotiated… if you have a little bit of something, it might be kind of a carrot to dangle,” Cruze explained.

Kamel also urged Jonathan to continue doing his “homework” and look into every financial assistance program available through the providers.

Given Jonathan’s income, Kamel said the providers may recognize that he simply cannot afford the full balance. If the bills remain unpaid and eventually go to collections, Kamel said Jonathan could potentially settle the debt for a fraction of what is owed.

Rather than being responsible for the full $400,000, “you end up settling for 10% to 30% of the total balance,” Kamel explained, which could bring the amount down to “$40,000 to $60,000.”

Beyond the debt itself, Cruze said Jonathan’s income would definitely need attention over the long term.

“I would be looking at some options in that scenario just from a career standpoint, because you are still so young,” she advised. “You’re 33, and I would want you not to struggle and grind inch by inch for the rest of your life either.”

Kamel agreed with Cruze, noting that income was a “key variable” that could be “controlled,” but acknowledged how difficult the road ahead would be.

“I hate that you’re going through this,” Kamel told Jonathan. “This sounds like it’s not going to be an easy fight, but we are rooting for you, man.”