North Carolina is using Medicaid funds to cancel the medical debt of some 2.5 million people in the Tarheel State.
More than 2.5 million North Carolina residents are getting over $6.5 billion in medical debt eliminated through a state government effort that offered hospitals extra Medicaid funds from Washington if they gave low- and middle-income patients the financial relief and implemented policies to discourage future liabilities.
The program is similar to one implemented by Arizona Gov. Katie Hobbs that eliminated $2 billion worth of medical debt in that state.
For $30 million and at no cost to Arizona taxpayers, Gov. Katie Hobbs will cancel the medical debt of around 1 million Arizonans.
Hobbs is using COVID relief funds to purchase the debt. The $30 million is expected to purchase $2 billion worth of medical debt in collections.
While states are taking action to help their citizens who have medical debt, the federal government isn’t helping:
Chloe Rogers of Americans for Financial Reform writes:
The Trump-appointed leadership of the CFPB and the lobby group for credit bureaus, the Consumer Data Industry Association, just asked a federal judge to vacate the medical debt rule. The Trump administration is siding with the credit bureaus, effectively asking the court to strike down the very protections the CFPB once championed.
At risk are financial protections for 15 million impacted people in the United States, which could unravel before they’ve even taken hold.
Despite some changes by the Big 3 credit bureaus, some 15 million Americans currently have medical debt on their credit reports.
A new report from the Consumer Financial Protection Bureau (CFPB) sheds light on the ongoing medical debt crisis.
The report shows that medical debt reported by credit reporting agencies totals $49 billion.