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Arizona Governor Katie Hobbs has unveiled a program aimed at eliminating $2 billion in medical debt for residents of the state.

In an announcement, Governor Hobbs said, “Today, I am so proud to announce that we are taking steps to retire medical debt for up to an estimated 1 million Arizonans. That’s a fresh start, a new chapter and a huge weight taken off the shoulders for every single one of them.”

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The plan involves allocating up to $30 million from the American Rescue Plan Act funds to collaborate with the nonprofit RIP Medical Debt, facilitating the buyback of Arizonans’ medical debt.

Governor Hobbs highlighted the program’s intention to ease the financial strain on middle-class families facing insurmountable medical bills due to unforeseeable health issues. She said, “Hard-working, middle class Arizonans should not be forced to have those difficult kitchen table conversations because of medical debt from conditions they cannot control. And as a social worker, I can tell you that feeling stuck in a hole, with no way out, can snowball into problems far beyond debt.”

Jeff Smedsrud, representing RIP Medical Debt, detailed the program’s criteria, targeting individuals earning below 400% of the federal poverty level or those whose medical debts constitute 5% or more of their annual income.

This announcement comes shortly after Connecticut Governor Ned Lamont revealed a similar initiative to forgive $1 billion in medical debt, leveraging funds from the American Rescue Plan Act and partnering with a nonprofit organization. Lamont empathized with those affected, saying, “This is not something they did because they were spending too much money. This is something because they got hit with a medical emergency. They should not have to suffer twice — first with the illness, then with the debt.”


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