Taxpayers to cover millions in medical debt of thousands of Illinois residents

[December 06, 2024]  By Glenn Minnis | The Center Square contributor

(The Center Square) – Illinois state Sen. Mike Simmons, D-Chicago, is hoping to see the new Medical Debt Relief Pilot Program backed by Gov. J.B. Pritzker expanded to benefit even more than the thousands of residents now on its radar.

As many as 300,000 individuals could be at least partly relieved of all outstanding medical debt after the governor’s office recently sent out notices to upwards of 52,000 residents alerting them that their debts have been covered by state taxpayers with the average amount being cleared at $1,349.

“Nobody should be burdened with medical debt,” Simmons told The Center Square after first seeing his Senate Bill 2442 signed into law in August. “It really does create dire circumstances for literally thousands of people across Illinois. We moved with great urgency in the spring session to pass this bill and I'm glad that we were able to do so.”

With the program being modeled off a Cook County program that was supported through funds from the American Rescue Plan Act, the state designated as eligible for the program individuals with a household income at or below 400% of the federal poverty level or whose medical debt is at or exceeds 5% of their household income.

Through all the back and forth, Simmons said everyone stands to win from the program, particularly as it continues to reach more residents.

“My ultimate goal for this is that people are getting more regular and frequent care and better care that has better outcomes so that people are starting to live longer and are less sick as they live longer,” he said. “I think that's going to benefit our whole state. The benefit to those individuals, their families and to the communities they live in can't be overstated.”

Illinois state Sen. Mike Simmons, D-Chicago
SenatorMikeSimmons.com

Going forward and with Black residents 50% more likely to suffer from such debt, Simmons said he plans to closely monitor the progress of the program over the next several months in hopes that more growth will come about much sooner than later.

The program is using $10 million in state funding in the new fiscal year to purchase the medical debt of up to 300,000 Illinoisans.

Opponents of the plan said taxpayer subsidies to a nonprofit to liquidate select medical debt may not provide the benefits supporters are looking for.

State Rep. Chris Miller, R-Oakland, said the state can’t afford it.

“One thing we need to remember is that Illinois is broke and people are leaving,” said Miller.

A study released in April by the National Bureau of Economic Research concluded while there is a statistical significant reduction in payment of existing medical debt with debt forgiveness programs, there is “no impact of debt relief on credit access, utilization, and financial distress on average” and “no effect of medical debt relief on mental health on average.”

It’s estimated nearly two million Illinoisans have more than $4 billion in medical debt.