More than $6.5 billion in medical debt has been wiped out for more than 2.5 million people in North Carolina, Democratic Gov. Josh Stein announced Monday.
First established in July 2024, the state’s Medical Debt Relief Program surpassed initial financial projections. The $6.5 billion in relief includes debt relieved through the program, as well as additional debt that was relieved when hospitals updated policies to implement the program.
“Medical debt is a tremendous weight keeping so many families from financial security, and, unlike most other forms of debt, it’s not a choice,” Stein said in a press release. “Today’s announcement will free people from financial stress so they can focus on getting healthy.
Stein credited former Democratic Gov. Roy Cooper, former North Carolina Department of Health and Human Services (DHHS) Secretary Kody Kinsley, and hospitals that partnered with the state to make the relief possible.
Stein urged the state General Assembly to keep the momentum going by fully funding Medicaid. The relief program waives both existing medical debt and prevents the accumulation of more in the future.
“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,” DHHS Secretary Dev Sangvai said. “We are grateful to the hospitals and providers who are helping to give a fresh start to millions of North Carolinians.”
Undue Medical Debt CEO and President Allison Sesso said the program protects patients while also ensuring hospitals remain financially secure.
“Healthcare providers are trusted pillars of the community, and we’re thrilled that all 99 hospitals have signed on to this initiative. We are hopeful this collaboration serves as a model for others, and we look forward to making care more accessible for North Carolina families by erasing these debts of necessity,” she said.
This week, approximately 255,000 North Carolina residents will begin receiving letters from individual hospitals that will provide an update on their debt relief. Undue Medical Debt will also be sending letters letting patients know if some or all of their medical debt has been relieved.
The initiative was made possible after 99 acute care hospitals across the state signed on in 2024, working in collaboration with the DHHS and Undue Medical Debt.
The Centers for Medicare and Medicaid Services (CMS) authorized North Carolina to tie hospital eligibility for enhanced payments under the Healthcare Access and Stabilization Program (HASP) to their medical debt policies.
Under HASP, North Carolina hospitals were required to relieve medical debt for certain low-and-middle income residents, while adopting more generous charity care policies. Hospitals were further required to streamline processes for determining eligibility for financial assistance and end the reporting of medical debt to credit agencies.
HASP launched alongside Medicaid expansion. Neither initiative required any state funding.
