Cleveland launches program to erase medical debt for residents earning up to 400% poverty level

The City Council of Cleveland held a press conference on May 1, 2025, to announce a significant initiative aimed at eliminating medical debt for local residents. The program allows the city to purchase medical debt in bulk from hospitals, health systems, and the secondary market, providing relief to individuals who meet specific criteria.

During the conference, officials explained that individuals qualify for debt relief if their income is up to 400% of the federal poverty level or if their medical debt exceeds 5% of their annual income. Once the city acquires the debt, it is simply erased without any application process or additional requirements. Residents will receive notification letters informing them that their medical debt has been abolished, with many already starting to arrive in mailboxes.

The initiative has been praised as a model for local leadership, showcasing what can be achieved through community investment and collaboration. Cleveland officials expressed pride in the program and its potential impact on residents' financial well-being.

Questions from the audience focused on the mechanics of the program, including the sources of funding and the process of purchasing debt. Officials clarified that the city targets specific ZIP codes when acquiring debt from the secondary market, ensuring that the relief is directed towards Cleveland residents. They also noted that while purchasing debt from hospital systems can be more complex, efforts are made to fundraise privately to cover debts for residents who may have sought care outside the city.

In conclusion, the press conference highlighted Cleveland's commitment to addressing medical debt and the innovative strategies being employed to provide relief to its residents. The city plans to continue its efforts in this area, with further communications expected in the coming weeks.