The death of a family member or loved one is a hard emotional blow. The vast majority of people are not prepared to face these losses. However, for many households in the United States, the death of someone is just the beginning of a financial ordeal. If that person has outstanding hospital bills, what happens to their medical debt? Knowing what is happening can prevent pain from spreading to your pocket.

One thing should be clear from the beginning: medical debts do not automatically disappear when a person dies. However, that does not mean that family members have to assume those payments immediately. In most cases, these financial obligations become part of the deceased's assets, that is, the set of assets, money and properties that he or she left behind.

The person in charge of administering the estate, whether an executor or a court-appointed administrator, must use available resources to pay valid debts before distributing the assets among the heirs. Among these obligations may be invoices for hospitalizations, surgeries, emergency care, medical consultations and other health services that were pending.

What happens if the inheritance is not enough to pay the bills?

Medical debts are considered unsecured debts, meaning they are not backed by a specific asset, such as a home or car. For that reason, the law establishes an order to pay the obligations of the estate.

Before medical debts are covered, other priority expenses are typically settled, such as estate administration costs, funeral expenses, certain taxes, and other claims that state law deems priority.

If there are no longer sufficient resources after meeting these obligations, medical bills may remain partially or completely unpaid. In many cases, the debt ends there and family members do not have to respond with their own money.

The exceptions that can make a family member responsible

Although the general rule protects family members, there are specific situations in which a person may end up paying a loved one's medical debt.

The first occurs when someone signed as guarantor or agreed to be responsible for payment at the time of admission to the hospital or receiving treatment. In this scenario, the obligation may fall on the person who signed the documents.

Another exception applies to some married couples who live in states with a community property regime. Depending on state law, the surviving spouse could be responsible for certain debts incurred during the marriage, including some related to health care.

There are also states that have filial responsibility laws. These rules, which only apply in very specific circumstances, may allow adult children to be responsible for some medical or long-term care expenses of their parents.

On the other hand, when a person age 55 or older received Medicaid-funded services for nursing home care or home care, the state can recover some of that money through a claim against the estate. This procedure is known as asset recovery and only affects the assets, not necessarily the personal money of family members.

How to Avoid Leaving Medical Debt to Family

The best way to prevent medical debt from complicating the probate process is to try to resolve it while the person is still alive. A major advantage is that many medical bills can be negotiated.

A good first step is to request an itemized invoice to verify that all charges are correct. Billing errors are more common than many people realize, and correcting them can significantly reduce your final amount.

If the debt remains high, it is possible to ask for discounts, negotiate an interest-free payment plan or apply for financial assistance. Many nonprofit hospitals offer financial assistance programs for patients who meet certain requirements.

It is also a good idea to carefully review your health insurance coverage. Sometimes, some invoices correspond to services that the insurer should have covered and that can be claimed.

Even if debts are already difficult to control, there are alternatives such as going to a credit counselor to establish a debt management plan or looking for specialized programs that negotiate agreements for amounts less than the original balance.

If you are the person who has the debt and you fear that it will affect your family's assets, it is best to resolve it beforehand. If you are the family member of someone who may have a large medical bill, you should confirm if the exceptions would apply to you or if they should look for alternatives to pay the debt.

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