PHOENIX — Gov. Katie Hobbs announced that Arizona will be taking steps to buy back the medical debt of up to 1 million residents over the next two years.
"Healthcare is not just a line item in a budget, it's a building block for thriving," Hobbs said. "No Arizonan should have debt hanging over their head because they needed help through no fault of their own."
Gov. Hobbs announced that the state will be taking steps to retire medical debt for up to 1 million Arizonans.
The "Affordable Arizona: Tackling Medical Debt for Working Families" program will use up to $30 million in American Rescue Plan Act (ARPA) funds to buy back Arizonans' medical debt, Gov. Hobbs said. Residents who make less than 400% of the federal poverty level and those whose debt equals 5% or more of their annual income are eligible for the program.
The state is partnering with the Long Island-based charity, RIP Medical Debt.
But there's no way to apply. To stay anonymous, and thus be tax-neutral for people, RIP Medical Debt doesn't work with specific patients. They buy debt in bulk and then pay it off in bulk. Only after it's paid off are people surprised with a letter saying their debt has been wiped clean.
Debt will be bought back from hospitals, healthcare providers and debt collectors and the debtor's credit score will be automatically adjusted, officials said.
"This is a win-win that will give so many Arizonans a clean slate and open the doors for a better future," Gov. Hobbs said.
“It's very difficult," Jim Baker, who spoke at the press conference Monday, said. "I mean, the money runs out every month.”
Baker said he has crippling medical debt from a battle with Stage 4 cancer. He now relies on food banks to get by and said almost all of his income goes to paying medical debt.
“I cannot resolve the debt and have to constantly just pay towards it," Baker said.
Baker is not guaranteed to have his debt paid off, though. He'll have to take his chances with everyone else who qualifies for the program.
The program is expected to take place over the next two years before ARPA funds expire.
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