While the handle going to the bar may be due to disc pad failure, it's
more likely (in my mind) that the system has become "air bound" and the
air within the hydraulic system is compressing. It may not be a case of
your brake system losing fluid, but rather simply air infiltrating the
system.
Check for loose fittings, then bleed the system. If that doesn't work
look further, but at least you have the inexpensive jumping-off point.
Good luck.
--Mark