Home Money & Business Business Connecticut to eliminate $30 million in medical debt.

Connecticut to eliminate $30 million in medical debt.

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HARTFORD, Conn. — Officials announced on Monday that Connecticut is the latest state to inform eligible citizens about the cancellation of some or all of their medical debt.

Beginning December 23, nearly 23,000 residents who collectively owe $30 million will receive notification by mail regarding this debt relief initiative. The state has partnered with the nonprofit organization Undue Medical Debt, with the aim of eventually eliminating up to $1 billion in medical debt for approximately 250,000 eligible residents.

Connecticut’s Governor Ned Lamont emphasized the unintended nature of medical debt, stating, “Medical debt is something you don’t necessarily have any control over. Medical debt is when you get hit hard by some sudden medical emergency and all of a sudden you find out the anesthesiologist is not in-network or a high deductible.”

Undue Medical Debt, which launched in 2014, has successfully canceled roughly $15 billion in medical debt by purchasing and forgiving debts for individuals who fall within specific income brackets. The organization has recently expanded its efforts to collaborate with state and local governments to relieve their constituents of medical debt, according to CEO and President Allison Sesso.

This year alone, New Jersey completed two rounds of debt cancellation in partnership with Undue Medical Debt, amounting to $220 million, while Illinois reported last month that nearly $72 million in medical debt has been eliminated so far.

Additionally, Undue Medical Debt has ongoing collaborations with states like Arizona and Rhode Island, as well as various cities and counties. These municipalities often utilize public funds, which include allocations from the American Rescue Plan Act, to facilitate the debt forgiveness process, typically purchasing the debt for only a fraction of its value. In Connecticut, officials have allocated $6.5 million in ARPA funds, with $100,000 put toward eliminating the initial $30 million of debt.

In a similar vein, Los Angeles County is poised to announce plans aimed at relieving medical debt for 150,000 of its residents. This initiative further highlights the growing trend across states to address the burden of medical debt for their populations.