Credit Counseling--Don't Get Sick
Yesterday, the bankruptcy “reform” law went into effect. Now it’s more difficult to have debts wiped clean and start over again. Individuals declaring bankruptcy will be required to pay back at least some of their debts, depending on their income.

The law also requires that people filing for bankruptcy get credit counseling.

Having worked as a customer representative in the credit industry, I spoke to more than a few callers with poor money management skills. These are the people who don’t realize that if they only make minimum payments while continuing to buy items on credit, their balances get bigger and bigger. I would definitely agree that these people could use some help in getting out of debt and some guidance on how to stay out of debt.

However, the number one reason for declaring bankruptcy is the inability to pay medical bills. I have to ask, what good is credit counseling in these cases?

Will credit counseling teach people how to avoid becoming castrophically ill? Will they learn where they can go for low cost health insurance when their employers don't offer it? And what about the unemployed, self-employed, or those unable to get insurance because of a pre-existing condition? Can counseling help if you've racked up a pile of hospital bills because your health insurance turned out to be one of many scam policies which cover the small claims, but disappear when it comes to covering the expenses of a serious illness?

Even people who have insurance coverage can be caught up in mounting debt. Many policies pay 80 percent of medical costs, requiring their customers to pay the other 20 percent. If you need something extreme, like a kidney transplant, it can cost up to a million dollars or more. That means you have to come up with $200,000. Right now.

Requiring people in this situation to sign up for credit counseling is not only a waste of everyone’s time, it’s literally adding insult to injury. Yes, I’m sorry, next time I have children, I’ll make sure they don’t have cystic fibrosis or congenital heart disease. Next time I’ll marry someone who won’t get cancer.

The obvious solution, is of course, universal health care. But Congress has never been very good at recognizing the obvious.