Nearly 40,000 Connecticut residents will soon learn that some or all of their medical debt has been erased, Gov. Ned Lamont announced Wednesday, as the state conducts a third round of an initiative intended to ease the financial strain caused by unpaid medical bills.
Letters notifying residents of the debt relief are being mailed this week under a program the Lamont administration launched last year in partnership with the national nonprofit Undue Medical Debt.
The latest round eliminates more than $63 million in medical debt, bringing the total erased since December 2024 to about $198 million for nearly 160,000 people statewide.
The program’s first round, launched in December 2024, erased about $30 million in medical debt for roughly 23,000 residents. A second round in May eliminated more than $100 million for about 100,000 people.
“Medical debt can delay healing due to stress and anxiety about how to pay these bills,” Lamont said in a statement.
The initiative targets residents who are least able to pay. To qualify, individuals must have incomes at or below 400% of the federal poverty level or carry medical debt equal to at least 5% of their income. For a family of four, the current federal poverty level is an annual income of $32,150.
Under the program, Undue Medical Debt uses state funding to negotiate with hospitals, health systems and collection agencies to purchase large portfolios of qualifying medical debt at a steep discount. Because the debts are acquired in bulk and involve patients with limited ability to pay, they often cost only pennies on the dollar, allowing substantial relief at a relatively low cost.
There is no application process for the program, and residents cannot request to participate. Those selected for relief are identified through the purchased debt portfolios and will receive letters in Undue Medical Debt-branded envelopes over the coming days.
The state plans to continue the partnership, Lamont said. He and the state legislature have allocated $6.5 million in federal American Rescue Plan Act funding to support additional rounds of medical debt cancellation in the future.
