Some of the millions of Americans who collectively owe billions of dollars for medical expenses have seen their debt forgiven in recent years, and there has been a dramatic uptick in aid this year. But the relief still only covers a small fraction of the outstanding balance and is just a stopgap measure that does not solve the fundamental problem: people in the US get into serious financial trouble because they can’t afford the healthcare they need, experts say. In 2024, people in the United States owed at least $220bn in medical debt, according to KFF, a nonprofit health research group.
About 14 million owed more than $1,000, and 3 million people owed more than $10,000. Even people with insurance often have high deductibles or high cost-sharing provisions in their plans, which means they could still find the bills unaffordable, Wager said. Patients often fall behind in their payments.
In 2024, 21% of US households had a past-due medical bill, according to the journal Health Affairs Scholar. In 2021, more than half of the bills sent to collectors were for medical care, according to the Consumer Financial Protection Bureau. Undue Medical Debt, founded in 2014 by former debt collection executives, helps address the problem by purchasing large portfolios of debt from healthcare organizations and collection agencies at a steep discount.
According to the organization, a $1 donation erases about $100 of medical debt. The organization does not take requests from individuals, but people who earn four times the federal poverty level or less, or with medical debt that is 5% or more of their annual income, are eligible. Undue Medical is not alone in helping people pay for their medical care.
For example, Dollar For, another nonprofit, allows patients to apply for financial assistance to forgive or reduce their medical debt and has provided more than $117m, according to the organization. The HealthWell Foundation helps with prescription copays and insurance premiums and deductibles, among other expenses.The Community Service Society of New York successfully advocated for state legislation like the Fair Medical Debt Reporting Act, which prohibits hospitals and providers from providing consumer reporting agencies information about a patient’s medical debt. Undue Medical gets its funding from private donors and state and local governments.
For example, in Illinois, the state provided $10m to Undue Medical, which used the funds to provide more than $1.1bn in medical debt relief for its residents, according to the state. Unlike when people get those nausea-inducing bills from providers, recipients get surprise notices informing them that their debt has been absolved. The organization states that it has provided $53.3bn in medical debt relief.
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