Connecticut cancels medical debt for 100,000 residents, providing significant financial relief to impacted individuals.
In a significant move to alleviate the financial burden of medical debt, Governor Ned Lamont of Connecticut announced that approximately 100,000 residents will receive notifications this week regarding the elimination of their medical debt, either in full or in part. This initiative is a continuation of a partnership with the nonprofit organization Undue Medical Debt, aimed at providing relief to those financially impacted by medical expenses.
The state has allocated funding from the American Rescue Plan Act to purchase 0 million in medical debt for a mere 5,000. This marks the second phase of Connecticut’s debt relief effort; in December, the government eradicated million in medical debt affecting 23,000 residents. The ultimate goal of the state is more ambitious, with plans to wipe out billion in medical debt affecting an estimated 250,000 individuals.
Governor Lamont emphasized the importance of this initiative, stating that individuals and families facing serious health issues should not have to endure the added stress of unaffordable medical costs. The relief will target households with incomes at or below four times the federal poverty level—set at ,150 for a family of four—while individuals with medical debt exceeding 5% of their income may also qualify.
This debt was acquired in bulk from hospitals and collection agencies for a fraction of its original value, underscoring that the beneficiaries often lack the financial means to repay it. Importantly, there is no need for individuals to apply or request this relief; it will be automatically granted to eligible residents.
The issue of medical debt is far-reaching, with over 100 million adults in the United States collectively owing more than 0 billion. Research from KFF, formerly the Kaiser Family Foundation, highlights the severity of this issue on a national scale. In response, at least 26 other state and local governments have initiated programs aimed at mitigating medical debt for their residents, following Connecticut’s pioneering efforts.
Recent announcements from jurisdictions such as Los Angeles County in California, Wayne County in Michigan, and Rhode Island indicate a growing trend towards medical debt relief. New York City is also actively pursuing similar initiatives, with plans referenced by Mayor Eric Adams to eliminate over billion in medical debt affecting up to 500,000 residents.
The proactive steps taken by Connecticut and other regions illustrate a broader commitment to addressing the pervasive crisis of medical debt in the United States, offering hope and relief to many families struggling with health-related financial burdens.
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