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CT to begin erasing medical debt for eligible residents

FILE, 2023 -
Tony Spinelli
CT Public
FILE, 2023 - Touting upcoming medical debt relief, Governor Ned Lamont said, “I think it’s really important that people have a sense that they can start building wealth of their own."

Connecticut will use funding from the American Rescue Plan Act this year to forgive medical debt for an estimated quarter million state residents, according to Gov. Ned Lamont’s office.

Last session, lawmakers approved $6.5 million in the state budget toward erasing eligible residents’ medical debt. Using the federal pandemic relief, Connecticut will partner with a nonprofit that buys medical debt for a small amount of the cost. The state is still in the process of contracting with a vendor, a spokesperson for Lamont’s office said.

On Friday, Lamont touted the upcoming relief on ABC’s Good Morning America.

“I think it’s really important that people have a sense that they can start building wealth of their own,” Lamont said . “We’re making that easier for people to do. And the best way to start is [to] eliminate the debt you’ve got.”

Four in 10 adults have medical debt in the U.S., according to KFF health policy data. A disproportionate number of those affected by medical debt are Black and Hispanic.

State residents whose medical debt is over 5% of their income, or who earn up to four times the federal poverty line, will be eligible for the relief. Those individuals could be notified as early as this summer, according to Lamont’s office.

There is no application process for debt cancellation, Lamont’s office said. The chosen vendor will examine hospitals’ large portfolios of debt that meet eligibility criteria.

As Connecticut Public's state government reporter, Michayla Savitt focuses on how policy decisions directly impact the state’s communities and livelihoods. Michayla has been with Connecticut Public since February 2022, and before that she was a producer and host for audio news outlets around New York state. When not on deadline, Michayla is probably outside with her rescue dog, Elphie. Thoughts? Jokes? Tips? Email msavitt@ctpublic.org.