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Cleveland City Council seeks to eliminate nearly $200 million in medical debt for 49,000 residents

Council introduced legislation Monday to use $1.9 million in American Rescue Plan Act funds to buy medical debt.

CLEVELAND — The lives of tens of thousands of Cleveland residents could be drastically changed thanks to a new proposal from city council.

On Monday, Cleveland City Council is introducing new legislation calling for the elimination of nearly $200 million in medical debt for roughly 49,000 city residents. 

According to the council, preliminary estimates show that using $1.9 million in American Rescue Plan Act (ARPA) funds would remove more than $190 million in medical debt. The city would purchase the debts through the nonprofit organization RIP Medical Debt, who specialize in buying “bundled medical debt portfolios on the secondary debt market, and then forgives that debt at pennies on the dollar.” 

RIP Medical Debt will also determine who qualifies for medical debt forgiveness. 

“The influx of ARPA funding allows us to use once-in-a-lifetime resources to make real change for Clevelanders," said Council President Blaine Griffin, one of the co-sponsors of the ordinance. "One of the largest issues that people have concerns about in this city is access to affordable health care. We know this ordinance, if passed, will alleviate some burden from the shoulder of tens of thousands of Clevelanders.”

In addition to Griffin, the ordinance is being sponsored by councilmembers Kris Harsh (Ward 13), Charles Slife (Ward 17), Richard Starr (Ward 5), Kevin Conwell (Ward 9), and Rebecca Maurer (Ward 12).

Harsh and Slife have already met with representatives from RIP Medical Debt.

“This ordinance would impact every neighborhood in our city,” Harsh added. “By forgiving medical debt, Council will support Cleveland households by decreasing their debt obligations and increasing discretionary dollars.”

Medical debt is one of the top reasons why Americans file for bankruptcy. The council adds that the ordinance is "consistent" with its commitment to resolve health inequities in disadvantaged communities, including communities of color.

The council noted that similar legislation to relieve medical debt of residents passed in Toledo and is being considered in Columbus.

The ordinance will be discussed in more detail at an upcoming Health, Human Services, and the Arts (HHSA) committee prior to the council taking further action. A full vote could come by this March.

"We have a sense of urgency," Griffin added. "We believe this is one of those kitchen table issues that is going to eliminate this kind of burden for the people of the city of Cleveland."

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