Nearly half of all Missourians currently owe medical debt – that's according to the Missouri Foundation for Health. Oftentimes, these debts are bought by collection agencies and resold for profit.
Mid-Missouri’s chapter of the Democratic Socialists of America has partnered with the St. Louis and Kansas City chapters to help Midwesterners pay off their medical debts.
The three are working with Undue Medical Debt, a non-profit that buys bundled medical debts from creditors using community-sourced donations.
Buying debts in bulk drastically discounts the price of the debt. For UMD, a $1 donation can erase $100 of debt.
So far, $1,856 has been raised - that could erase nearly $186,000 worth of debt, according to their model. Their aim is set at $15,000 in donations to clear over $3.5 million in debts.
“[Medical debt] is a situation that we don’t believe anyone should be in,” said Tyler Ludwig, a member of Mid-Missouri DSA’s steering committee. “Anything we can do to help out some people that have found themselves in that situation we thought was an important thing to do.”
The Undue Medical Debt model is similar to that of a collection agency. Unlike collectors, Undue Medical Debt uses donations to clear the cost of debts bought from the secondary market instead of trying to turn a profit.
Undue Medical Debt can’t clear debt for specific individuals, but they can purchase bundled debts by region. The debts currently being cut are based in Kansas, but the coalition intends to grow the program into Missouri.
Individuals whose debt is erased are notified by a letter.
Undue Medical Debt has partnered with philanthropic organizations as well as local governments. Last fall, the city of St. Paul, Minnesota partnered with UMD to abolish nearly $40 million of medical debt for 32,000 residents. Last month, New Jersey completed its third round of debt elimination with UMD, clearing $26 million.
The city of St. Louis had set aside $800,000 of funding from the American Rescue Plan Act, distributed by the federal government following the COVID pandemic, to clear $80,000,000 of debt for city residents.
The plan ultimately fell through. BJC Healthcare, a major provider in the St. Louis metro and a key partner in the deal, pulled out of the program.
It’s not yet certain how the reserved funds will be reallocated.
Missourians who are Black, Hispanic, have disabilities or live in rural areas are more likely to have or had medical debt.
Most medical debt in the state is accrued from a one-time or short-term medical expense. Those can include diagnostic tests, doctor visits, emergency care and prescription drugs.
More than half of Missourians with medical debt reported using up all or most of their savings to counter the debt. To make ends meet, a quarter dipped into their retirement or tuition savings or took out loans.
“It is just blatantly ridiculous I think for people to find themselves in debt just because they had to seek medical care,” Ludwig said. “It’s not a luxury good … they’re doing these things because they’re sick and they need treatment.”
70% of Missourians reported skipping or postponing medical care due to their debt.
Ludwig views the Democratic Socialists at the forefront of healthcare reform, propelled to that position after DSA candidate Bernie Sander’s bid for presidency in 2016.
“We also look at this as a way to have a really important conversation with people while we’re doing it,” Ludwig said. “We just had a presidential election and neither candidate really had any sort of plan for fixing our current healthcare system.”
