City of St. Paul Abolishes $40 Million Worth of Medical Debt for 32K St. Paul Residents

MINNESOTA— Last week, St. Paul Mayor Melvin Carter announced that the City, in partnership with nonprofit Undue Medical Debt, has abolished $40 million in medical debt, benefiting 32K residents. This is the first of several rounds of funding the City will disperse for medical debt forgiveness.

During St. Paul’s 2024 Budget Address, Mayor Carter committed to putting $1.1 million in American Rescue Plan (ARPA) dollars towards erasing approximately $110 million in medical debt for eligible individuals.

According to a press release, the average amount of forgiven debt was $268, while the largest sum was $104,972.

“Medical debt is a major barrier holding our neighbors back from prioritizing their health,” said Mayor Carter in the same release. “By removing the burden of debt, we invest in the long-term health of our entire community.” 

“Medical debt is a psychological burden, in addition to a financial one, that can cause patients to avoid necessary care; simply having medical debt creates stress which undermines people’s health,” insisted Undue Medical Debt CEO and President Allison Sesso.

“That’s why I’m grateful for this partnership which is already removing this burden for tens of thousands and helping families heal.” 

To be eligible for the debt relief, individuals must currently live in Saint Paul with income up to 400% of the current Federal Poverty Guidelines, or medical debt accounting for 5% + of their annual income. Individuals will be notified by mail if some or all of their medical debt has been erased. They will not need to take any action to benefit.

Minnesota Attorney General Keith Ellison thinks the program should expand throughout the state. "There's no reason why this should stop at St. Paul,” he said.

"This is a public good…This will actually enhance the health of the entire city for people who don't owe a penny."