KarunaNews Story

More than $6.5 billion in medical debt is being eliminated for more than 2.5 million North Carolina residents through a unique state government effort that offered hospitals extra Medicaid funds if they gave low- and middle-income patients the financial relief and implemented policies to discourage future liabilities. The effort grew from the Healthcare Access and Stabilization Program, approved by state legislators in 2023 at the same time as expanded Medicaid coverage to working adults who couldn't otherwise qualify for conventional Medicaid. The state Department of Health and Human Services last year proposed that certain hospitals could receive higher program reimbursement levels to treat Medicaid enrollees if they agreed to medical debt initiatives. By August 2024, each of the roughly 100 acute-care, rural or university-connected hospitals that qualified decided to participate. They had to eliminate medical debt going back to early 2014 for patients who are Medicaid enrollees, would later have to eliminate other debt for non-enrollees based on income levels, and were directed to discourage debt by automatically enrolling people in charity care programs or curbing certain debt collection practices.