How large do medical expenses have to be for colleges to take them as an extenuating factor for financial aid? I am a single parent so my savings and income is all that is available for college expenses. Last December I was hit by a truck while walking across the street and broke both elbows. Two weeks later I had a stroke that was likely caused by a blood clot from one of my elbows releasing and going to my brain. The stroke and subsequent brain bleed caused me to be out on disability for half of the year. Thankfully, I am back at work now but I did have more than $13k in medical expenses this year that I was not prepared for (thank goodness for good insurance, it was not more). Is that enough for extenuating circumstances or not? I will know in two months whether being out on disability will impact my income for next year (I suspect it will, but hoping it does not). I did not send any information regarding this to the schools D20 is applying to, but now I’m wondering if I should. Thoughts?
Is this 13K unreimbursed medical expenses?
@twokids2go - this is a classic ‘it depends’. The impact of the $13k in medical expenses (I assume this is out-of-pocket) will depend on your financial situation and the school’s aid program. Also, most schools are ‘need blind’, so your financial situation should not impact admission. When the initial aid offer comes in, that will be the opportunity to bring this information to the attention of the FA department.
First - your financial situation - I am not suggesting you respond on CC with your numbers. Also, these numbers are relative to your location. An income of $105k is considered working poor in San Francisco. In the Midwest, you are upper middle class. I would suggest if your EFC is over $25k, you most likely have sufficient income to absorb the $13k in the eyes of most Financial Aid departments. An EFC lower than $25k, I would definitely submit the information to the FA department. If any of the schools your D20 gets accepted to use the CSS Profile for financial aid, there is usually a question about unusual circumstances you feel they should know about.
Second - the school’s aid program. For a state school, your one time medical expense will likely not matter. For example, my DS was accepted to a UC school and we got zero aid, even though his EFC was roughly $12k and COA is $30k. On the other hand, private schools tend to have different aid formulas due to the higher COA. Many of them also promise to meet demonstrated financial need. These schools will use the CSS Profile to gather more financial information from you. They will take your medical expenses into consideration for aid. The level of impact will be dependent on your financial situation.
@twokids2go - I should have asked this first - are you doing ok? That is a rough road to travel. The recovery from a stroke is a long process. I wish you the best of luck.
@usma87 - thanks for the response. I think I will hold off and only use this information if we are within a couple of thousand of being able to afford. I actually recovered from the stroke fairly quickly but when the doctor was removing the clot, the wire went to the wrong part of my brain, causing a bleed at my optic nerve that appears to be causing permanent problems. Thankfully, they are manageable (I can drive again and can read a computer screen, although I will likely not be reading books again). Thank you once again.
When were these medical expenses? The 2018 tax year is the one financials are used for the 2020-2021 financial aid forms.
If it were me, I would contact the college(s) and find out what their process is for a special circumstances consideration based on your medical expenses.
I also suggest calling the schools about a special circumstances review. It could possibly help, so in my opinion, it’s worth pursuing.
I think schools are very understanding of medical costs. It isn’t just the unpaid (by insurance) costs, but a lot of other costs too. When my daughter was born, she spent 89 days in the hospital. 100% of her bill w s paid, but there were 89 days of parking, 89 days of eating 3 meals a day at or near the hospital, extra fees and cost, lost time from work. It’s just expensive to have medical problems.
In your case you may have had extra Uber fees because you couldn’t drive, co-pays for specialists or tests, over the counter medications. It really adds up fast.
I’d contact the school or schools and ask them about it. It may only be a couple thousand, but that would help too.
My question is about medical circumstances affect how they look at assets, not just income.
When facing highly precarious medical issues, a family could very easily and suddenly end up with no one being able to work anymore or huge out of pocket costs (skilled nursing). That makes equity in a home, or other reserves, not something people can tap for college. The rainy day fund takes on additional importance. It isn’t a true liquid asset, it is more akin to a retirement account - which schools don’t consider.
When you ask for a special circumstances consideration, you lay out all of the financial concerns, with documentation, that you have related to the medical expenses.
WRT using home equity and the like…those are things that would happen in the future. Certainly they should be mentioned as part of your request, but since there hasn’t been a need for this yet…there would be no documentation that you used these items (home equity) for medical expenses. There absolutely are some instances where it’s likely that could happen…but there is no documentation or guarantee that it will.
Loss of income is something that you document.
Just get the information on the process, and include any issues with documentation that you feel would be relevant to your situation.
These are handled on a case by case basis.
Can a lawyer help with getting the $13k plus paid by outside parties who caused the accident and the brain bleed from wire in the wrong place or will the $13k never be reimbursed?
@Madison85 - Unfortunately they can’t be 100% certain the stroke was caused by the car accident. I did get reimbursed for the direct medical costs of the broken elbows but nothing else. So the $13k is unreimbursed. The accident was at the end of 2018 so covered in my data for FAFSA, the stroke was 2019 so impact to my income from being out of work and subsequent medical expenses will not show up until the next FAFSA. I am lucky that I had good disability insurance.
Thank you, everyone, for the advice!
Your insurance didn’t reimburse you the cost of care for your stroke?
Your loss of income in 2019 should be easily documented as 2019 has ended. I think it’s worth inquiring about a special circumstances consideration. It might net you nothing…but worth asking.
It sounds like your income for 2020 is OK which is great news.
I think you need to talk to a better personal injury atty. no way is it believable that the accident and stroke weren’t somehow related. I’d be on the phone with some of the best Attys asap.
As others have said, it all depends upon the school. You get a school that doesn’t meet need anyways, just gives federal entitlements, additional Medical expenses may not do a thing. At some full need schools , it might be a consideration. You have to talk to each FA Director and send documents and explanations as requested.
I know that at some schools that give good aid packages, someone on the edge of qualifying for aid, or who qualified for some aid, may get reported income lowered by medical expenses paid in a given year. Sometimes such expenses, could reduce AGI considerably
Ask your CPA. Usually you can write off extra medical expenses if they exceed a % of your income. The % varies based on an IRS formula. I’d bet that FA does too. Your CPA or tax person can probably answer this question in a minute. Best to get proper advice. Sorry for your troubles. That sounds just awful.
Are you suggesting that the CPA might know something about how financial aid works? I doubt it. Certainly the CPA or whomever does taxes, can deal with the medical expenses and tax implications. But I wouldn’t even consider them the experts on financial aid policies at a variety of colleges as they relate to medical expenses.
This parent needs to contact the college financial aid offices directly.
@thumper1 Most definitely the CPA knows about Financial aid. I know our CPA was talking about the FAFSA or whatever that form is called. We told them our kids are too young. They even had the form to fill out and someone in their office who worked with clients to fill it out.
Using the CPA to determine IF it can be claimed. Then using the college ( if needed) to determine how to write it up (if applicable) is the way to go.
Nobody needs to pay a CPA to tell them how to fill out FAFSA. After all, the first F in FAFSA stands for “free.” I think thumper was saying that it’s unlikely that a CPA is a good person to get specific financial aid information from. FAFSA is only one small part of the overall financial aid picture.