Currently the FASFA does not look at debt of any kind, including medical of students or family members. The form solely looks at the income of the parents.
If the medical bills outweigh or come close to the income, the FASFA isn't a true representation of what the student can afford.
This wouldn't be much of an issue, just take out another loan to cover it such as a Parent Plus Loan. However, with the parent's medical debt, they are often denied the loan.
This makes it very difficult for the student to attend college with a situation out of their control.