Connecticut plans on implementing first-in-the-nation medical debt relief program

Connecticut is rolling out a first-in-the-nation program that will give eligible residents a break when it comes to medical debt.
"I was on the phone yesterday with a constituent who has $100,000 debt to Nuvance Hospital, and she's crying because she's a retired teacher. How is she ever going to pay that?" says State Sen. Julie Kushner (D-Danbury).
The program is part of a budget passed by Gov. Ned Lamont last year.
"They should not have to suffer twice - first with the illness, then with the debt," says Lamont.
Lamont shared details of the program, expected to begin in June, on "Good Morning America," on Friday.
The state will cancel $650 million in medical debt for 250,000 residents.
"This is not something they did because they were spending too much money. This is something because they got hit with a medical emergency," says Lamont.
There is no application process.
People are eligible if they owe medical debt that's more than 5% of their annual income or if they're less than four times over the federal poverty line.
If you're debt has been canceled, you will receive a letter in the mail this summer.
The state is contracting a nonprofit to buy the debt with $6.5 million in American Rescue Plan Act refunds.
Lamont originally pushed for about three times as much spending in early budget discussions, which some legislators did not not support.
On Friday, some lawmakers called for additional reform.
"It's a way to address a problem that shouldn't exist. I think we need to go beyond that in many ways though, to make sure that people don't accumulate medical debt by having a better medical insurance system, more protections," says State Sen. Martin Looney (D-New Haven).
State officials say medical debt is the top source of debt collections and causes two-thirds of personal bankruptcies. They hope the program will allow people a fresh start, particularly for those already struggling.
"I think it's really important that people have a sense that they can start building wealth of their own. We're making that easier for people to do, and the best way to start is eliminate the debt that you've got," says Lamont.
House GOP Leader Vincent Candelora's Response to Gov. Lamont on GMA Interview on Medical Debt:
The Governor's celebratory lap over his move to use taxpayer dollars to pay off bad medical debt carried by hospitals is a slap in the face to residents and organizations who want adequate funding for government's core functions but time and again see his administration and the Democrat-controlled legislature prioritize spending to support policies from their agenda that are far outside of that scope. The Governor may enjoy the headlines he's getting from this, but I have little doubt this policy decision will disappoint people with debt who don't qualify for relief and frustrate organizations and officials as capitol conversation continues about meeting needs such as local special education costs, heating assistance for vulnerable residents, and investing in Medicaid rates for all residents.