| Photo by Marek Studzinski on Unsplash
HARTFORD, CT – As part of an ongoing initiative led by Governor Ned Lamont, in partnership with the nonprofit Undue Medical Debt, Connecticut is taking a big step to help residents struggling with medical debt.
The state invested $575,000 from the American Rescue Plan Act (ARPA) to negotiate and eliminate over $100 million in qualifying medical debt. It follows a first round of relief in December 2024, which erased $30 million in medical debt for 23,000 residents.
“Medical debt causes additional anxiety and stress when individuals and families are coping with potentially life-threatening health situations,” Lamont said. “Over the next few days, more than 100,000 Connecticut residents who have been struggling to pay their medical bills will feel relief when they receive letters in the mail notifying them that their debt has been erased.”
The governor also hopes that additional medical partners will soon sign on to this program, which will help more Connecticut families through further rounds of this initiative.
Game-changer
This initiative is a game-changer for Connecticut residents struggling with medical debt. Erasing over $100 million in qualifying medical debt for 100,000 residents provides immediate financial relief and reduces stress for families facing overwhelming bills in many ways.
Medical debt can negatively impact credit scores, making securing loans, housing, or even a job harder. Eliminating this debt gives residents a fresh financial start.
As many families face anxiety over unpaid medical bills, especially when dealing with severe health conditions, this relief allows them to focus on recovery rather than financial burdens.
In addition, the fear of accumulating medical debt often prevents people from seeking necessary care. With debt erased, residents may feel more comfortable accessing healthcare services. Families can redirect money toward essentials like rent, food, and education instead of struggling to pay off medical bills.
“I’m very grateful for the State of Connecticut’s continued partnership in providing medical debt relief to its residents,” Allison Sesso, CEO and president of Undue Medical Debt, said. “The erasure of these debts of necessity wouldn’t be possible without community-minded leaders like Governor Lamont and his team, who believe medical debt should not be a hindrance to seeking needed care. We look forward to continuing our work in the state so families can seek healthcare with dignity.”
Growing trend
This initiative is part of a growing trend, with other states and cities launching similar programs, including New York City, Los Angeles County, and Rhode Island. Connecticut’s approach is one of the first statewide efforts, setting an example for broader medical debt relief nationwide.
Lamont has emphasized that this relief is just the beginning, with hopes of expanding the program further. It could set a precedent for tackling medical debt on a larger scale.
To qualify for Connecticut’s second round of medical debt cancellation, residents must meet one of the following criteria:
- Income Requirement: Household income must be at or below four times the federal poverty level (currently $32,150 for a family of four).
- Debt Burden: Medical debt must be 5% or more of the resident’s annual income.
The Lamont administration said there is no application process—eligible residents are automatically identified, and those selected will receive a letter from Undue Medical Debt notifying them that their debt has been erased.
Undue Medical Debt is a nonprofit organization that eliminates medical debt for struggling individuals. Founded in 2014 as RIP Medical Debt, the organization purchases large portfolios of medical debt from hospitals, medical providers, and debt collectors—often for pennies on the dollar—and then forgives the debt for those who qualify.
How It Works
- Debt Relief Model: Every $10 donated can erase $1,000 in medical debt.
- Eligibility: Relief targets individuals whose income is below four times the federal poverty level or whose medical debt is at least 5% of their annual income.
- Impact: Since its founding, Undue Medical Debt has abolished over $15 billion in medical debt for millions of people
Notable Contributions:
- MacKenzie Scott donated $50 million in 2020 to support debt relief efforts.
- New York City invested $18 million to erase $2 billion in medical debt.
- Connecticut partnered with Undue Medical Debt to cancel $100 million in medical debt for 100,000 residents.
“Medical debt can be a crippling burden on patients, especially those who are already struggling to make ends meet,” State Representative Cristin McCarthy Vahey, co-chair of the legislature’s Public Health Committee, said. “Erasing medical debt for an additional 100,000 residents will greatly ease the stress they are facing and will free them up to focus on their health and well-being. Thank you to Governor Lamont and Undue Medical Debt for their leadership on this innovative program.”
