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Lexington reports $12.6 million in medical debt abolished under new relief program
Summary
City staff updated the council on a partnership with nonprofit Undue Medical Debt that used a $1 million ARPA allotment to abolish about $12.6 million in medical debt for roughly 6,484 Fayette County residents; staff said the program yields roughly $100 in debt relief per $1 spent and recommended quarterly reports when abolishments occur.
Victoria Cruz Faulk, legislative aide to Vice Mayor Dan Wu, told the Urban County Council on Jan. 13 that Lexington's medical-debt relief partnership with nonprofit Undue Medical Debt has produced measurable results in its first round.
Faulk said the council previously authorized a $1,000,000 allotment from American Rescue Plan Act interest earnings to fund the program. She said Undue Medical Debt purchases qualifying files from hospitals or collectors for pennies on the dollar, performs eligibility screening and address-verification work, and issues notices to affected residents so abolished balances cannot be resold. "On average, every $1 spent eliminates more than $100 in medical debt for residents," Faulk said.
City materials presented at the work session show the first local abolishment…
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