Stopgap measure does not solve fundamental problem that millions can’t afford the healthcare they need, experts say

Some of the millions of Americans who collectively owe billions of dollars for medical expenses have seen their debt forgiven in recent years, and there has been a dramatic uptick in aid this year.

But the relief still only covers a small fraction of the outstanding balance and is just a stopgap measure that does not solve the fundamental problem: people in the US get into serious financial trouble because they can’t afford the healthcare they need, experts say.

“Addressing the affordability crisis in healthcare is what will ultimately get at the heart of the issue,” said Mary Shannon, director of Care Over Collections, a nonprofit that educates patients who receive bills about their options.

In 2024, people in the United States owed at least $220bn in medical debt, according to KFF, a nonprofit health research group. About 14 million owed more than $1,000, and 3 million people owed more than $10,000.

“Costs are very high, and some people have no health insurance, so when they get sick or injured or need healthcare, they have no way to pay the extremely high charges,” said Emma Wager, KFF senior police analyst.

Even people with insurance often have high deductibles or high cost-sharing provisions in their plans, which means they could still find the bills unaffordable, Wager said.

Patients often fall behind in their payments. In 2024, 21% of US households had a past-due medical bill, according to the journal Health Affairs Scholar. In 2021, more than half of the bills sent to collectors were for medical care, according to the Consumer Financial Protection Bureau.

Undue Medical Debt, founded in 2014 by former debt collection executives, helps address the problem by purchasing large portfolios of debt from healthcare organizations and collection agencies at a steep discount. According to the organization, a $1 donation erases about $100 of medical debt.

The organization does not take requests from individuals, but people who earn four times the federal poverty level or less, or with medical debt that is 5% or more of their annual income, are eligible.

Undue Medical is not alone in helping people pay for their medical care. For example, Dollar For, another nonprofit, allows patients to apply for financial assistance to forgive or reduce their medical debt and has provided more than $117m, according to the organization. The HealthWell Foundation helps with prescription copays and insurance premiums and deductibles, among other expenses.The Community Service Society of New York successfully advocated for state legislation like the Fair Medical Debt Reporting Act, which prohibits hospitals and providers from providing consumer reporting agencies information about a patient’s medical debt.

Undue Medical gets its funding from private donors and state and local governments. For example, in Illinois, the state provided $10m to Undue Medical, which used the funds to provide more than $1.1bn in medical debt relief for its residents, according to the state.

Unlike when people get those nausea-inducing bills from providers, recipients get surprise notices informing them that their debt has been absolved.

The organization states that it has provided $53.3bn in medical debt relief. About half of that was provided this year. The organization attributes that spike to its investment in technology that allows it to process files more quickly and its increased partnerships with governments.

“I am hopeful everyone that receives a letter feels more comfortable going back to the doctor and getting the care that they need and are not scared about the financial consequences,” said Allison Sesso, president and CEO of Undue Medical.

Still, Sesso acknowledges that the financial assistance is a “stopgap for people that need help today”.

“We have set up a system that incentivizes profits over people,” Sesso said.

To affect change upstream, providers must do more to make patients aware that they offer financial assistance, advocates argue.

For example, in Missouri, almost all general hospitals offer free or discounted care but less than a quarter of adults said they received information about the programs from a provider, according to a 2025 study from the Missouri Foundation for Health and the Lown Institute.

States are working to increase financial assistance to patients who need it. Federal law requires nonprofit hospitals to establish a financial assistance policy but does not specify any minimum eligibility requirements; 18 states have gone further and required all hospitals – including for-profit ones – to offer financial assistance with minimum eligibility standards, according to the Commonwealth Fund, a nonprofit that studies health care issues.

Six states also have “presumptive eligibility” laws, which require hospitals to screen patients to determine if they qualify for assistance and if so, proactively erase the debt, KFF Health News reported.

The Biden administration also passed a rule that banned the inclusion of medical debt on credit reports, but the Trump administration and trade groups asked a federal court to block the measure, which a judge did.

But 16 states prohibit or restrict the inclusion of such debt on credit reports, according to the Commonwealth.

“It has a major impact on people’s credit ratings,” said Sara Collins, Commonwealth senior scholar for expanding coverage and access. “People have healthcare problems that are not their fault, and yet they are being saddled with medical debt because they don’t have the coverage to pay it off.”

In 2019, Tiffany Miller was just 26 weeks pregnant when she went into labor. Her daughter, Brie, spent more than three months in the neonatal intensive care unit and then required physical and occupational therapies. Even though Miller, a mental health caseworker, had insurance, she still accumulated more than $2,000 in debt.

“I’m a very faith-based person, so I had just been praying a lot because a lot of this debt was on my credit report,” said Miller, 40, who lives in Aurora, Illinois.

In May, she received a letter from Undue Medical informing her the debt had been erased.

She thought it was a scam but did some research and learned it was real. Meanwhile, Brie is now a healthy seven-year-old.

Harris said: “It just felt like those financial weights that have accumulated over the years, like a couple of them were taken off.”