Connecticut will cancel medical debt for all eligible residents, its governor announced Friday, making it the first state to do so.
Gov. Ned Lamont said during an appearance on “Good Morning America” that the state will erase medical debt for thousands of eligible residents under a new initiative that aims to help people from an often overwhelming financial burden.
“This is not something they do where they spend too much money. This is because they are hit by a medical emergency, and they should not suffer twice: first for illness, then with debt,” said Lamont.
Eligible residents do not need to apply for the relief because the state will work directly with contracting agencies to eliminate medical debt.
These exemptions should take effect by June, the government said.
Those who have finally cleared their debt also won’t have any associated tax burden, as the government says the IRS doesn’t count medical debt canceled through nonprofits as taxable income.
According to the “GMA,” eligible residents include those whose “household income is up to 400% of the federal poverty line (for a family of four, which is $156,000 annually) or whose medical debt equals 5% or more of their annual income will qualify under this programme.”
Governor Ned Lamont says Connecticut will cancel all medical debt for eligible residents. AP
The new state plan aims to leverage $6.5 million in America’s Rescue Plan Act funds to eliminate about $1 billion in medical debt, Lamont said.
The governor initially announced the proposal on the same day last year, linking the relief to COVID-related funds.
“Some state and local governments have seen significant success in canceling medical debt for their residents using this model, and I think this is the right way to use this COVID recovery funding,” Lamont said on February 2, 2023.
He added: “This initiative will not only help debt-ridden Connecticut residents financially, but it will also lift the significant emotional burden that this type of debt has on individuals who do not have the means to get out, especially for those who are simultaneously experiencing problems. significant medical. This debt relief will put millions of dollars back into the Connecticut economy and provide an economic boost to local communities.”
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Nearly 1 in 5 households across the US has at least some medical debt, according to the US Census Bureau. The median amount owed is $2,000.
While Connecticut hopes to be the first state to erase medical debt, several cities, including New York City, New Orleans and Pittsburgh, have also announced or implemented similar plans.
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Source: thtrangdai.edu.vn/en/
