In his time acceptance speech On Thursday night, Democratic presidential candidate Kamala Harris spoke about the exorbitant cost of healthcare in the United States.
“As president, I will bring the workforce, workers, small business owners, entrepreneurs and American companies together to create jobs, grow our economy and lower the cost of everyday necessities like health care, housing and groceries,” Harris said. 2024 Democratic National Convention in Chicago.
One of the issues Americans think about the most is health care costs medical debtwhich Harris owns promised to eliminate for millions of Americans.
According to the report, about 1 in 12 adults in the United States has medical debt KFF’s latest surveya nonprofit group that researches health policy issues. Almost 3 out of 4 adults say they are worried about paying an unexpected medical bill.
Harris has yet to reveal many details about his strategy to eliminate medical debt, but policy experts say a new medical debt relief program from North Carolina could offer a road map.
Earlier this month, North Carolina Governor Roy Cooper made the announcement had signed about 100 hospitals in the province Participating in the Medical Debt Reduction Incentive Program, he said, would encourage hospitals to eliminate $4 billion in medical debt for 2 million low- and moderate-income patients over the next two years.
Starting next year, Cooper said the program will take steps to prevent hospitals from accumulating new debt, in part by limiting aggressive debt collection practices such as adding high interest rates or fees to unpaid debts or selling the debt to a third party. – party collection agencies.
Hospitals will have until July 1, 2025 to forgive past debts; but some have already done so.
According to Stanford University economics professor Neale Mahoney, who served on the White House National Economic Council in 2022 and 2023, Vice President Harris closely coordinated the plan with Cooper and participated in the announcement. a campaign event last week In Raleigh, North Carolina, Harris thanked Cooper for canceling his state’s medical debt, and Cooper introduced Harris at the convention on Thursday.
“I suspect he sees this as a model for what other states can do,” Mahoney said. “North Carolina is not a deep blue state, so it’s possible that other states will get on board.”
“Anyone can find themselves vulnerable”
Experts say that medical debt is different from other types of debt, usually caused by a person knowingly taking on more debt than they can repay.
Cambridge Health Alliance critical care physician Dr. “It’s unpredictable, you never know when you’re going to get sick,” Adam Gaffney said of medical debt. “You can walk into the emergency room waiting to be quickly evaluated and then admitted to the hospital.”
It could be medical debt often leaving families in financial ruin: The average deductible for employer-based health insurance — the amount someone must pay out of pocket before coverage kicks in — was more than $1,700 per person in 2023, said Larry Levitt, KFF’s executive vice president of health policy.
People often have to borrow money from family members or put hospital bills on credit cards, which can lead to credit card debt, Levitt said.
“Almost anyone can find themselves vulnerable to medical debt,” said Levitt, who described North Carolina’s plan as a “creative approach.”
“A lot of people don’t have that kind of money lying around when they get hit with a bill of this size,” he said.
As vice president, Harris made medical debt an already central issue by promising to remove unpaid bills from credit reports — a move praised by experts who say credit reports unfairly penalize people for getting sick. A low credit score can make it difficult to get a mortgage or get a rental agreement.
In June, the Consumer Financial Protection Bureau suggested rule this will reduce the number of people with medical debt listed on their credit reports to zero. A CFPB representative said the earliest the rule could go into effect would be next year, though that could change depending on the outcome of the election.
Mahoney and other experts said Harris hinted that the North Carolina plan could be implemented nationwide if elected to the White House in November.
In an economic policy proposal shared by Harris’ campaign last week, he said that as president he would “work with states” to eliminate the medical debt of millions of Americans and “prevent the accumulation of such debt in the future” — the main tentpole of the North Carolina plan.
“I think that statement was encouraging because it talked about both debt relief and debt collection termination,” Mahoney said.
“The North Carolina approach could be a blueprint for other states,” Levitt said.
Will states accept it?
According to a release shared by the North Carolina Department of Health and Human Services, participating hospitals will forgive all outstanding medical bills for Medicaid enrollees through January 1, 2014.
They will also forgive all medical debt for people who are not on Medicaid but have incomes at or below 350% of the federal poverty level. $90,370 for a family of three — or when their total debt exceeds 5% of their annual income.
The policy would automatically enroll eligible individuals into financial assistance programs known as charity, offer income-based discounts on medical bills, prevent the sale of medical debt to collectors for those below 300% of the federal poverty level — $77,460 for a family of three — and ensure that covered debts are not reported to credit agencies.
Siara Zachary, associate professor of health policy and management at the UNC Gillings School of Global Public Health in North Carolina, said this is possible thanks to the Healthcare Access and Stabilization Program, a federal program that provides higher payment rates to hospitals. serving large numbers of Medicaid and uninsured patients.
Hospitals will receive additional federal funds if they forgive existing debt and take action to prevent future medical debt.
The Centers for Medicare and Medicaid Services signed off on the plan.
Zachary said it’s something Harris could roll out across the country.
“It could be like an expansion that states could adopt, or it could be some kind of big, sweeping legislation,” he said. “I think maybe the Harris administration can continue to encourage and promote those efforts as well.”
Still, he said, some Republican-led states could refuse to pass it simply because it was introduced by Democratic leaders — which happened when the Affordable Care Act, also known as Obamacare, was signed into law by former President Barack Obama in 2010.
“There will be states that are like, ‘That’s great, we want to be progressive,'” Zachary said. “And then there may be a few traditional or historically red states that may not be early adopters, but they recognize that they have hospitals that are at risk of closing. ”
Mahoney said there was more Harris could have done.
“I see medical debt as the most obvious example of a dysfunctional health care system,” he said. “The cost of medical care for sick people can be shockingly high. You can show up at the ER and get a $30,000 bill.