ALLENTOWN, Pa. — A program aimed at forgiving medical debt, built into Gov. Josh Shapiro's state budget proposal this year, could help relieve about a million Pennsylvanians of their medical bills.
A bill introduced in the previous legislative session would have created the PA medical debt relief program. Shapiro now has written the program into his proposed 2024-25 state budget.
"This year, the governor was bold and courageous enough to actually make it a part of his annual budget proposal,” said state Rep. Josh Siegel, D-Lehigh.
The $4 million medical debt relief program would be available to folks who make up to 400% of the federal poverty level, Siegel said.
Dental debt would be included.
"That $4 million will actually translate into $400 million of relief for residents across the Commonwealth, based on the way that the debt markets work for this medical debt sort of buy back."State Rep. Josh Siegel, D-Lehigh Valley
Siegel represents the 22nd House District, which includes parts of Allentown and Salisbury Township. He said he’s an advocate for the program.
"That $4 million will actually translate into $400 million of relief for residents across the commonwealth, based on the way that the debt markets work for this medical debt sort of buy back," Siegel said.
'A critical component'
Siegel said the program most likely would be administered through a debt relief coordinator at the state Department of Health and Human Services.
"People historically forgo necessary and sometimes critical treatment out of fear that they'll be penalized or punished for asking for new care."State Rep. Josh Siegel, D-Lehigh Valley
“This isn't just about relieving medical debt for the sake of getting rid of a financial burden that someone is experiencing, that's adversely affecting their credit score,” Siegel said.
“People historically forgo necessary and sometimes critical treatment out of fear that they'll be penalized or punished for asking for new care while they still have this outstanding debt, which I think is a critical component."
With about $1.8 billion in outstanding medical debt in Pennsylvania, Siegel said that over time, the goal is to eliminate the state’s medical debt all together.
No application would be needed to be eligible.
"The debt relief coordinator would be instructed to make sure the relief had as much parity and equity across the commonwealth to ensure that every region of the state benefits,” Siegel said.
He said the medical debt relief program would take six months to a year to set up if the budget is passed June 30.
