New York City plans to wipe out $2 billion in medical debt for 500,000 residents

[Eugene]

Source: Associated Press

New York City plans to wipe out $2 billion in medical debt for 500,000 residents

Updated 3:23 PM EST, January 22, 2024

NEW YORK (AP) — New York City intends to wipe out more than $2 billion in medical debt for up to 500,000 residents, tackling a top cause of personal bankruptcy, Mayor Eric Adams announced Monday.

The city is working with RIP Medical Debt, a nonprofit that buys medical debt in bulk from hospitals and debt collectors for pennies on the dollar. The group targets the debt of people with low incomes or financial hardships and then forgives the amounts.

Under the program, the city will spend $18 million over three years.

“For middle- and working-class New Yorkers, medical bills can be financially devastating,” Adams said as he announced the plan. “Working-class families often have to choose between paying their medical bills or some of the basic essentials that they need to go through life.”

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Read more: https://apnews.com/article/rip-medical-debt-new-york-city-adams-1f39530cd79937ced52f47ab4749fb58

[SWBTATTReg]

1. Wow. Clever. Buy bulk debt for pennies on the dollar from the scavengers and wipe the debt legally out.

I wish all debt was handled / resold like this in bulk. Think of the millions of people who fall into hard times that would benefit. But I do fear abuses in the program. Those that can pay totally legitimately would take advantage of the program, leaving fewer dollars to help those who really need the help. I wonder tho, if this bad debt was resold, if the names of those incurring the bad debt, would still have a bad mark on their credit report, or will the credit reports be updated to reflect the paid off debt?