New Orleans City Council Plans to Forgive Medical Debt for Consumers

By Consumers for Quality Care, on January 4, 2023

The New Orleans City Council is working on a plan that could provide relief for consumers with medical debt, according to 4WWL.

Medical debt affects 4 in 10 Americans overall and 56 percent of Black Americans. The impacts of medical debt on consumers are also far-reaching. “Medical debt like this can impact your credit. So, if you’re looking for housing opportunities, things like that, you’re looking to buy a car, it can impact your credit,” New Orleans City Council President Helena Moreno said.

The council plans on utilizing a small portion of American Rescue Plan Act (ARPA) funds to pay off the debt that Orleans Parish consumers owe to hospitals and clinics. The debt owed will be bought for pennies on the dollar, so it’s estimated that $1.3 million of the funds will cancel about $130 million in medical bills.

City Councils in Chicago and Toledo, Ohio have already approved plans to utilize ARPA funds to erase medical debt for consumers in their communities.

CQC applauds efforts like these that aim to address and alleviate the medical debt crisis for consumers. CQC also urges lawmakers and the Biden administration to address the root causes of medical debt and protect consumers.