I think this passage is talking about both hell and life in the here and now. Matthew 5 gives a little more understanding to this than Luke does.
Mat 5:25 Agree with thine adversary quickly, whiles thou art in the way with him; lest at any time the adversary deliver thee to the judge, and the judge deliver thee to the officer, and thou be cast into prison.
Mat 5:26 Verily I say unto thee, Thou shalt by no means come out thence, till thou hast paid the uttermost farthing.
This parable like all parables is written in symbolic language. The adversary is the accuser of the brethren, the judge is Moses or the law. Our adversary uses the law to accuse us. On the eternal level, if we agree with our adversary that we truly are guilty as charged of breaking the law then we avoid hell because Jesus paid the uttermost farthing for us.
On the temporal level, if we agree with our adversary that we are still guilty of breaking the law even after salvation and rest in the finished works of Jesus, then we avoid the prison of works salvation.
In both scenarios, we can't in and of ourselves pay the uttermost farthing, Jesus has to pay it.