“Providing relief from medical debt can be life-changing for hardworking Kentuckians,” Andy Beshear stated as the state announced its latest figures in clearing medical debt.
A Kentucky program has successfully erased $153 million in medical debt for about 67,000 residents. State officials confirmed that another round of notification letters is expected to be mailed during the week of Nov. 9.
This most recent wave of cancellations eliminated nearly $50.6 million owed by more than 22,000 Kentuckians. The initial rollout wiped out more than $100 million for about 46,000 residents.
The overarching goal of the initiative is to eliminate a total of $250 million in medical debt for an estimated 130,000 people across the commonwealth. State leadership points out that medical bills tied to cancer treatments, childbirth, and other care burden families for years. That lingering debt often places major financial milestones, such as purchasing a home, harder to reach.
How the Team Kentucky Medical Debt Relief Program Operates
The state established the Team Kentucky Medical Debt Relief Program through an executive order signed in September. That directive funneled $2.5 million into Undue Medical Debt, a national nonprofit organization.
Gov. Beshear announced that a total of $153 million in medical debt has been erased for 67,000 Kentuckians as his administration makes progress toward the goal of $250 million in relief through the Team Kentucky Medical Debt Relief Program. Read more: https://t.co/Zk2VvSzEnS pic.twitter.com/wxOUEOSOQN
The nonprofit acquires medical debt portfolios directly from participating hospitals and collection agencies for a fraction of its face value. Because of that steep discount, Kentucky estimates that every $1 spent eliminates approximately $100 in consumer medical bills.
Residents cannot apply for the program, nor can they request specific bills be erased. Instead, Undue Medical Debt identifies qualifying accounts independently through participating debt portfolios.
Individuals selected to receive relief will receive a direct notification letter from Team Kentucky and the nonprofit organization detailing which specific debts and creditors were included in the forgiveness. The first batch of letters has already been mailed, and the next group is expected to go out around the week of Nov. 9.
Recipients do not need to take any additional steps to secure the relief, though state officials advise keeping the notice as documentation.
Qualify for Kentucky Medical Debt Cancellation
To qualify for debt cancellation, an individual must reside in Kentucky and meet at least one of two specific financial criteria. Residents must have outstanding medical bills totaling at least 5% of their annual income, or maintain a household income at or below 400% of the federal poverty level.
For a family of three, that income threshold sits at approximately $100,000 a year, according to the state.
Allison Sesso, president and CEO of Undue Medical Debt, noted that the latest wave of cancellations will notify more than 22,000 people that their balances have been canceled. She stated that the organization hopes the relief eases financial strain and encourages recipients to feel more comfortable returning to medical care.
With the latest announcements, the state program sits roughly 60% of the way toward its stated $250 million debt-relief target. State officials direct residents seeking further information to MedicalDebtRelief.ky.gov.
