Almost 23,000 Connecticut residents will see some, or all, of their medical debt erased in the coming weeks through a recent state initiative.
In 2023, Connecticut lawmakers approved $6.5 million to partner with a nonprofit to buy up medical debt for pennies on the dollar. This first round of relief uses $100,000 from the state’s allocation of American Rescue Plan Act (ARPA) funding to wipe out $30 million in owed bills.
“This is all about making sure that health care is more broadly available and accessible and affordable,” Gov. Ned Lamont said in a press conference Monday, pointing to medical emergencies as one example, “making sure that when you come out of the hospital, you don't have another burden on your shoulders.”
The majority of people in the U.S. with medical debt owe over $10,000, according to KFF.
Eligible residents include people with debt that’s over 5% of their income, and those whose income is at or below four times the federal poverty level. That’s about $120,000 for a family of four, or $60,000 for a single person.
Residents are automatically selected for the program and will be notified by mail – here’s an example of the letter – that their debt is being forgiven, officials said.
“If you are one of the 23,000 people that are receiving this, it is not a scam. It's really good news," said Lt. Gov. Susan Bysiewicz. “Once you receive this letter, that your debt is eliminated, you don't have to do anything except keep the letter."
The nonprofit the state is partnering with is Undue Medical Debt – formerly known as RIP Medical Debt. Allison Sesso, its CEO and president, said people face high costs, especially if they are uninsured, have a high deductible or end up with an out-of-network provider.
“What we do is we buy those debts for pennies on the dollar, just like a for profit debt buyer would do, but we leverage government and donated dollars to do that,“ Sesso said.
Undue Medical Debt is working directly with the hospitals in the state to clear those medical debts.
Polling by KFF Health shows that people in the U.S. with a disability or in poor health are more likely to have medical debt - data shows that such debt affects over 4 in 10 U.S. adults.
State Sen. Dr. Saud Anwar (D-Windsor), co-chair of the public health committee, said the state needs to prevent high costs for Connecticut consumers in the first place.
“There's a cost of pharmacy, there's a cost of health care, there's a cost of insurance, and all of these things would have to be tackled, and we will be having frank conversations during this session about these.”
Lamont said he’s looking for other ways to work with Connecticut hospitals and legislators to tackle the price of care in the state.
“But this is a very good start,” Lamont said.
Learn more
NPR’s Life Kit: Medical bills can cause a financial crisis. Here's how to negotiate them
