More than 32,000 St. Paul residents with unpaid medical debt ranging from $268 to more than $272,000 have had their debt erased, thanks to a city partnership with Fairview Health Services and Undue Medical Debt. Nearly $37 million in medical debt has been paid for pennies on the dollar.
Residents who’ve had their debt forgiven will receive a notice in the mail, likely this week, officials said. Notices were postmarked Wednesday.
Jennifer Lor, a spokeswoman for St. Paul Mayor Melvin Carter, said Wednesday that this is just the first wave of a partnership that officials hope will erase unpaid medical debt for thousands more St. Paul residents. Officials hope to announce similar partnerships with other health systems in the months to come.
This is the first debt relief package of the Medical Debt Reset Initiative, which Carter first announced during his 2024 budget address in August 2023. In all, the city plans to use $1.1 million in American Rescue Plan dollars to erase an estimated $110 million in medical debt.
More than $100,000 of that money has been spent so far, Lor said.
“Medical debt is a major barrier holding our neighbors back from prioritizing their health,” Carter said in a statement Tuesday. “By removing the burden of debt, we invest in the long-term health of our entire community.”
How it works
Basically, St. Paul is using money approved by the City Council last year to help buy residents’ unpaid medical debt. Undue Medical Debt, a nonprofit working in partnership with the city, will negotiate with various health systems to buy unpaid debt for pennies on the dollar. Fairview was the first health system to participate, but officials said it will not be the last.
Residents do not need to take any action to be included. Undue Medical Debt will determine which St. Paul residents qualify.