Wanye and Ingham counties are working with the nonprofit RIP Medical Debt on plans to forgive some county residents of debt they owe to health care systems. Ingham County's board voted to commit $250,000 to the group, with state matching funds bringing the total amount up to $500,000. Wayne County is also working on a contract with the group.
RIP Medical Debt buys debt from hospitals and care providers and, instead of pursuing collections, it forgives the debtors. They’ve entered into similar agreements with Oakland, Muskegon and Kalamazoo counties.
Allison Sesso is the group’s president and CEO. “We take donations or government dollars and we buy debt in bulk from hospitals or other health care providers. We pay pennies on the dollar by mimicking the for-profit debt market,” she said. "We send letters out to all the people who qualify and let them know that we have relieved their debt.”
The group targets homes that earn less than four times the federal poverty line or whose debt makes up 5% or more of their annual income.
Sesso said the deals with the counties are still tentative and encouraged patience. “We both have to get into the contract with the county, leverage those dollars and bring them down as well as get into the agreements with the hospitals. Those are two bureaucracies that we have to wait our way through so that can take some time.”
She said that the Ingham County negotiations “haven’t really started yet,” but said the sides would “get there.”
Sesso said helping people out of debt improves their credit, eases their mental strain, and encourages people to seek medical help. “They're either ashamed of going back to that health care provider or they're concerned about getting into deeper debt or being denied altogether,” she said.
“One of the things that happens when you relieve medical debt is it gives people a willingness to go and get the health care that they need.”
