Car and Med Insurance?

Question

If somebody were to get into a bad car accident, the med costs can rack up, and it'd be best to have insurance burgeon a portion of the debt. But let's say that due to financial straits, said person figured suicide in such a scenario so as to escape debt and the bill. But what happens if he/she survived and unconsciously underwent ER? Then if he/she suicided, there would normally be the debt from the operation. If he/she suicided, then perhaps friends or family would have to inherit the debt? - in which case, all of this seems like an awkward debt generation hole in the economy. Is there law or insurance policy compensating for this?

Answer 1

Any debts that a person has are to be paid by their estate. Whoever administers the estate must, in all states, publish an announcement to the effect that Smith is deceased and all claims must be made by such and such date, probably within 90 days. If (this is a small if) the hospital takes 6 months to make their claim, it is too late for them (provided that notice was properly given).

There are also limits on how much can be collected, the simplest case being that you can't collect more than what is in the estate. There can also be complexities regarding order of priority – as you would expect, you must pay debts to the government first. That could include the Medicaid clawback (officially "estate recovery"), however, in the circumstance that you describe it doesn't sound like that would be applicable. There may also be exemptions in a state, for example in Florida, your registered homestead (property of a certain size that you have been living in and have filed the paperwork for) cannot be seized to pay debts, even after death.