LA County cancels $2B in medical debt for residents
LOS ANGELES COUNTY, Calif. - Los Angeles County officials announced the cancelation of $2 billion in medical debt for residents.
Under the leadership of the LA County Board of Supervisors, the LA County Department of Public Health launched the LA County Medical Debt Relief Program. This initiative, designed by the Medical Debt Coalition, aims to cancel medical debt for county residents. The county is partnering with Undue Medical Debt, a national nonprofit formerly known as RIP Medical Debt, which has erased unpayable medical debt for more than 9 million people in the U.S.
With $5 million in funding from the county, along with additional contributions from LA Care Health Plan and the Los Angeles County Medical Association, Undue estimates it can purchase and cancel up to half a billion dollars in medical debt for LA County residents. Starting in early 2025, residents whose debt has been abolished will receive letters notifying them of their relieved debt.
Medical debt affects one in ten adults in LA County and many residents face bills they cannot pay due to various reasons. Even with insurance, costs can quickly accumulate, leading to substantial debt.
In 2022, Los Angeles residents accumulated over $2.9 billion in medical debt, making it the leading cause of bankruptcy in the United States. This burden disproportionately affects families with children, lower-income individuals, and Latino, Black, American Indian, and Pacific Islander communities, as well as those with chronic health issues. The financial strain can lead to physical and mental health problems, forcing people to struggle with basic needs like food and housing and potentially causing them to delay or skip medical care.
The program's overall goal is to relieve $2 billion of medical debt, making a meaningful difference in the lives of the 785,000 LA County residents currently burdened by medical debt. The county hopes that philanthropic partners, hospitals, and other health plans will join in supporting this effort, alongside long-term reform initiatives.