Mayor Carter Announces Nearly $40 Million of Medical Debt Abolished for 32,000 Saint Paul Residents

SAINT PAUL - Today, Mayor Carter announced that the City of Saint Paul and Undue Medical Debt abolished nearly $40 million of medical debt for 32,000 Saint Paul residents. In partnership with national, independent nonprofit Undue Medical Debt purchased from Fairview Health Services and is the first relief package of Mayor Carter's Medical Debt Reset Initiative.

During his 2024 Budget Address, Mayor Carter committed $1.1 million in American Rescue Plan dollars to erase an estimated $110 million in medical debt for qualifying Saint Paul residents. In this first round, the average amount of debt forgiven was $268 while the largest debt forgiven was $104,972.

Recent data reveals that national medical debt has reached about $220 billion, impacting over 100 million Americans. Among the insured, roughly 54% of adults carry medical debt, while 41% of the uninsured face even greater challenges. This complex burden often forces individuals to delay necessary care to prioritize basic needs like food and housing. However, postponing care leads to unresolved health issues, exacerbates anxiety and depression, and escalates larger financial problems.

"Medical debt is a major barrier holding our neighbors back from prioritizing their health," said Mayor Carter. "By removing the burden of debt, we invest in the long-term health of our entire community."

Many individuals are just one medical emergency away from facing a financial crisis. The Peterson Center on Healthcare and KFF reports 7.6% of Minnesota residents have medical debt, and the debt burden for communities of color are more elevated. Black adults are 50% more likely and Hispanic adults 35% more likely than white adults to owe money for care.

"Fairview is committed to improving the health of Saint Paul and the wider East Metro, as a health care provider and an anchor in the community. Over the last few years, we have taken several important steps forward to realize our bold vision to bring breakthrough care to more people including the creation of the Fairview Hub for Community Health and Wellness, and our ongoing dedication to addressing the social determinants of health. Whether it's through our Food is Medicine, Housing is Health, or our Connection is Cure programs, we are proud to step up and help make our communities stronger and healthier," said Fairview Health Services President and CEO James Hereford, "Health is not only about buildings, hospitals, or clinics - health care is about meeting the needs of patients where they are and doing whatever we can to improve health outcomes and decrease cost. Our partnership with the City of Saint Paul and Mayor Carter reflects our longstanding dedication to seek innovative solutions that have long challenged the health care sector."

State and national partners have also taken steps to address medical debt fairness. In Minnesota, the Medical Debt Fairness Act recently went into effect with its most notable provisions banning medical debt from being reported to credit reporting agencies. The act also ensures medical providers cannot withhold medical care despite unpaid debt.

The City of Saint Paul and Undue Medical Debt hope to partner with the Minnesota Attorney General's Office to explore ways to build on the Debt Fairness Act.

Debt relief is a clear solution that reduces the stigma of medical debt and promotes awareness and policy change in addition to removing the emotional and financial burden of medical debt currently weighing on people. Undue Medical Debt works directly with providers like hospitals and physician groups in addition to the secondary debt market to purchase and erase qualifying medical debt.

"I have immense appreciation for Mayor Carter and the Saint Paul team behind the Medical Debt Reset Initiative, as well as Fairview Health Services for partnering with us to support a healthier Saint Paul and erase these debts for those currently least able to pay," shared Undue Medical Debt CEO and President Allison Sesso. "Medical debt is a psychological burden, in addition to a financial one, that can cause patients to avoid necessary care; simply having medical debt creates stress which undermines people's health. That's why I'm grateful for this partnership which is already removing this burden for tens of thousands and helping families heal."

Individuals who qualify for medical debt abolishment through the city's initiative must currently live in Saint Paul, have incomes up to 400% of the current Federal Poverty Guidelines, or have medical debt that is 5% or more than their annual income. Debt relief is source-based, meaning the initiative can only erase qualifying debts that are acquired from participating providers like hospitals. Those eligible as part of the first round of abolishment will be notified soon by mail that some or all of their debts have been relieved. Recipients do not need to take any action.

The city will announce as more debt is relieved and recipients receive letters in the mail. On Wednesday, November 13, Mayor Carter will be joined by the Undue Medical Debt CEO to participate in a virtual workshop with Next City's Solutions Festival. For more information or to register, click here.

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