New York joins cities erasing medical debt
A New York City plan to buy up medical debt for up to a half-million low- and middle-income residents could erase over $2 billion in medical bills, city officials said.
Why it matters: It marks the largest municipal effort yet to wipe out medical debt, a leading cause of personal bankruptcy and a threat to people's health.
Details: New York is investing $18 million over three years in a partnership with the nonprofit RIP Medical Debt, which buys up medical debt in bulk on the cheap.
- There's no application process — residents will be told if their debt has been paid off.
The big picture: The federal government has taken steps to erase medical debt from credit scores, while states have sought other measures to ease the financial burden.
- But a growing number of cities and counties are simply wiping the slate clean for some residents struggling with medical bills.
- Among those that have leveraged federal pandemic relief funds to erase medical debt are Illinois' Cook County (which has eliminated $281 million for nearly 160,000 people), New Orleans and St. Paul.
Los Angeles County, the nation's most populated, is weighing a plan to eliminate over $2 billion in medical debt.
- A county report last summer found that about 810,000 residents have medical debt, with disproportionate impacts on lower-income and minority residents.
Go deeper: When medical debt is forgiven