North Carolina’s medical debt relief program has surpassed its initial financial projections, relieving more than $6.5 billion in medical debt from 2.5 million residents over the past year.
In July 2024, CMS approved the state’s plan to use medical debt policies as a condition of eligibility for North Carolina hospitals to receive an enhanced level of payment under the Healthcare Access and Stabilization Program, which began at the same time as Medicaid expansion, according to an Oct. 13 news release from Gov. Josh Stein’s office.
In August 2024, all 99 of the state’s eligible hospitals opted into the program, which was initially projected to relieve $4 billion for 2 million North Carolina residents. Hospitals were given a series of deadlines to implement the program erasing debt dating back to 2014.
By July 1, participating hospitals were required to forgive past debt of Medicaid beneficiaries and have policies in place to ensure medical debt does not affect a person’s credit rating and curb aggressive collection practices for low-income patients.
The $6.5 billion total includes debt relieved through the program as well as additional debt eliminated as hospitals updated their policies to implement the initiative, according to the release.
The North Carolina Department of Health and Human Services partnered with Undue Medical Debt — formerly RIP Medical Debt — to support participating hospitals and help them identify medical debt that is eligible for relief. Hospitals are continuing to work with Undue Medical Debt to facilitate full implementation of relief over the next year.
“Medical debt delays access to care and easing debt is a pivotal step forward to improving the health and well-being of those who carry the emotional stress and financial weight of high costs for medical care,” Health and Human Services Secretary Dev Sangvai said in the release. “We are grateful to the hospitals and providers who are helping to give a fresh start to millions of North Carolinians.”
