TOLEDO, Ohio — Thousands of Toledoans could soon have their medical debt wiped clean.
City Council is expected to vote on the proposal Tuesday. If passed, it would spend $1.4 million of American Rescue Plan Act funds erasing some of that debt.
Nearly 25,000 Toledoans qualify for this program. Residents are eligible if their medical debt is greater than five percent of their income or if they make less than four times the federal poverty level. For a household of two people, the federal poverty level is $17,420, meaning that household would need to make less than $69,680 annually to qualify for the medical debt erasure program.
Councilwoman Michele Grim introduced the proposal. She said it could wipe out anywhere between $180 and $200 million dollars of debt.
If city council passes the program, the city would partner with the non-profit "RIP Medical Debt" to buy debt from local hospitals at a cheaper price. Just one dollar could relieve a hundred dollars worth of medical debt.
The health chair for Toledo's NAACP, Erika White, said communities of color primarily made up the service industry during the pandemic, meaning a lot of them lost their jobs and health insurance.
She explained when city leaders talk about relieving medical debt, they're talking about for those who live in under-served neighborhoods.
"The biggest part we have is when you relieve that debt from families, from individuals, you allow them to get back to where they were before the pandemic," White said. "You allow families to then have both equity and also equality moving that money to where they need it."
Officials with the United Way of Greater Toledo say the partnership with "RIP Medical Debt" wouldn't go away anytime soon.
"They've made very clear that when they come to Toledo, this isn't a one and done," Ryan Bunch said. Bunch is the Senior Director of outreach and advocacy with United Way of Greater Toledo. "They don't want us to give this money, they wipe this debt then they go away. They want to stay here for the long term. They want to build those relationships with those hospitals and continually build this cycle of eliminating debt as it moves into collections."
If approved at city council, which Councilwoman Grim expects it to, then "RIP Medical Debt" will begin the process of acquiring debt portfolios and paying them off. Once that happens, you'll get a letter in the mail if your debt makes the cut.
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