07/01/2024 | Press release | Distributed by Public on 07/01/2024 09:05
Today, North Carolina Governor Roy Cooper and the NC Department of Health and Human Services announced new actions leveraging the state's Medicaid program that will encourage hospitals to relieve a potential $4 billion in existing medical debt for approximately two million low and middle-income North Carolinians and ease the burden of medical debt in the future.
NCDHHS submitted a request to the U.S. Centers for Medicare and Medicaid Services (CMS) to approve a set of conditions hospitals must meet to be eligible to receive an enhanced amount of Medicaid funds. These conditions include relieving existing medical debt and establishing policies to prevent the accumulation of medical debt for low- and middle-income North Carolinians. Hospitals that choose not to meet these conditions will receive the standard amount of these funds.
"Large medical bills from sickness or injury can cripple the finances of North Carolinians, particularly those who are already struggling," said Governor Cooper. "Freeing people from medical debt can be life changing for families, as well as boost the overall economic health of North Carolina."
Medical debt is a growing burden across the United States. A recent investigation found that up to 41% of US adults are estimated to have some form of medical debt. Medical debt is incurred by people regardless of whether they have insurance, and there is a disproportionate impact on Black and Hispanic communities, as well as people living in rural areas particularly those in Southern states. While hospitals are not the only form of medical debt, they are the largest. North Carolina hospitals currently hold an estimated total of more than $4 billion of debt and often expect to receive a small fraction of the original value through collections practices.
"North Carolinians are carrying the emotional and financial burden of debt, and often delay necessary care because of past bills," said Health and Human Services Secretary Kody H. Kinsley. "Medicaid Expansion gave 600,000 people access to care. Relieving medical debt will get individuals and families into care sooner, bring down the cost of care and give them a fresh start on a healthy and productive life."
Once approved by CMS, hospitals that implement a set of medical debt relief and mitigation policies will be eligible for enhanced payments under the Healthcare Access and Stabilization Program (HASP) (hospitals that choose not to implement the policies will be eligible for HASP payments at a lower level). These policies will provide relief to consumers through forgiveness of existing debt, establish protections against the accumulation of future medical debt, and prevent problematic debt collection practices going forward. Specifically, hospitals will be required to implement the following policies as a condition of eligibility for enhanced HASP payments:
NCDHHS has partnered with Undue Medical Debt as the preferred facilitator of medical debt relief. This work aligns with NCDHHS' continued commitment to improve the health and well-being of North Carolinians through smart investments that lower costs in the long-run by addressing social determinants of health, supporting access to prevention, removing barriers to health care, and incentivizing healthy outcomes.
Additional information is available in the Frequently Asked Questions on the Effort to Relieve Medical Debt in North Carolina.
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