Los Angeles County has launched a $500 million pilot program aimed at reducing medical debt for local residents. The program, which began on December 16, is the first step in addressing the $2.9 billion in outstanding medical debt owed by LA County residents.
Unlike previous medical debt relief initiatives that required individuals to apply, this new program takes a more proactive approach. The LA County Department of Public Health is collaborating with the nonprofit organization Undue Medical Debt to work directly with hospitals that agree to participate.
Under this model, the county and Undue Medical Debt identify eligible debts and pay a portion of the outstanding amount to the hospitals. Once this payment is made, the remaining debt is fully forgiven.
Eligible residents will receive updates on the debt relief process via mail. The first notifications are expected to be sent as early as January 2025. County officials estimate that the program will benefit approximately 150,000 residents, with total debt relief reaching around $500 million.
Janice Hahn, a member of the LA County Board of Supervisors and co-sponsor of the program’s budget proposal, emphasized the importance of this initiative during a press conference on December 16. “No one should have to go into poverty to get the health care they need, and yet that’s exactly what’s happening,” she said. “Medical debt is crushing families across our communities.”
NBC News reported on December 17 that hospitals like Martin Luther King Jr. Community Hospital and Adventist Health White Memorial are participating in the program. Inquiries have been sent to all hospitals in LA County, and officials expect more hospitals to join in the coming months.
For a debt to qualify, a person must be an LA County resident with a past due bill that is not on a payment plan. They must also either earn less than or equal to 400% of the federal poverty level ($124,800 for a family of four in 2024) or owe a hospital 5% or more of its annual household income
The pilot program is supported by $5 million in funding proposed by Supervisors Janice Hahn and Holly Mitchell. The proposal was approved by the Board of Supervisors in June 2024.
Additional financial support has been provided by LA Care Health Plan, which contributed $2 million, and the Hospital Association of Southern California, which donated $1 million. In total, the program has secured $8 million in funding. If fully utilized, the program could provide debt relief to approximately 200,000 residents, forgiving a total of $800 million in medical debt.
An estimated one in 10 LA County residents—about 785,000 people—struggle with medical debt, according to county data. As part of this pilot initiative, LA County aims to expand the program to provide continued support for its residents facing financial hardship due to medical expenses.
BY YOUNGNAM KIM [kim.youngnam@koreadaily.com]
