NC’s first-in-the-nation medical debt forgiveness program — inspired in part by our Debt Jubilee Project – is now being shared with other states that could follow suit. The NC Department of Health and Human Services has created a website with a template that other states can borrow.
Under the plan, hospitals would forgive more than a decade of existing medical debt for eligible residents and work to prevent the accumulation of new debt going forward. Past medical debt that exceeds 5% of a person’s annual income will be relieved. In exchange, hospitals receive higher levels of Medicaid reimbursement under the federal Healthcare Access and Stabilization Program (HASP). Participating hospitals are required to curb aggressive debt collection practices for low-income patients, such as debt sales, excessive interest rates and home foreclosures. Hospitals are required to meet and report on these and other milestones, as well as publicly post debt relief policies.
Several other states has encouraged hospitals to work with Undue Medical Debt, usually using state funds (as Pensylvania did) to purchase the debts at a steep discount through the charity. However, NC’s plan of leveraging HASP funds was a new concept, and proveds the “carrot” to entice hospital systems to sign on.
Read more about it in the Winston-Salem Journal: NC Sharing Debt Relief Template With Other States
DHHS Website Press Release: NCDHHS Introduces Toolkit for States to Take Action on Medical Debt
Download NC DHHS Template PDF
