352K Arizonans will have medical debt wiped away, governor says
Arizona Gov. Katie Hobbs
PHOENIX - Gov. Katie Hobbs and the nonprofit Undue Medical Debt are wiping away $429 million in medical debt for more than 352,000 Arizonans.
What we know:
The effort, which began last year with funds from the American Rescue Plan, involves buying debt from hospitals and collections agencies for pennies on the dollar to give debtors a fresh start.
The governor stated that letters notifying individuals of the debt relief would be sent, with some already in the mail.
"Last year, Governor Hobbs announced a historic initiative to erase $2 billion in medical debt for up to one million Arizonans. The state made American Rescue Plan Act funds available to Undue Medical Debt to purchase debt from providers like hospitals and collection agencies for pennies on the dollar and cancel the balance," the July 16 news release from the governor's office read, in part.
It's reported that Arizonans hold about $2.4 billion in medical debt.
Who's Eligible?:
Eligible Arizonans include those earning up to 400% of the federal poverty level, or individuals who owe at least 5% of their annual income for outstanding medical bills.
There is no application process.
"Program beneficiaries receive a branded letter in the mail from Undue Medical Debt notifying them that some or all of their debt has been erased," the news release said.
Click here to read more about the announcement & what the letter in the mail will look like.
Big picture view:
One study indicates that a hundred million Americans collectively hold $220 billion in medical debt.
"Medical debt has profoundly harmful consequences for individuals and the communities they live in, leading to postponement of critical and often lifesaving care, declining credit scores and job opportunities, and physical and mental health issues," the governor's press release stated.