Connecticut governor announces plan to wipe out medical debt for all residents

Connecticut Gov. Ned Lamont (D) announced Friday a first-in-the-nation plan for the state to cancel medical debt for eligible residents.

The state plans to use $6.5 million in American Rescue Plan funds to eliminate approximately $1 billion in medical debt for Connecticut residents.

“This is an important priority for our administration and will provide financial and emotional relief to thousands of Connecticut families,” the governor said on X Friday morning.

A recent Consumer Financial Protection Bureau report found that medical debt accounts for more than 50% of debt in collections nationwide, exceeding credit card, personal loan, utility, and phone bills combined.

Connecticut is planning to contract with a nonprofit group that buys medical debt at reduced costs, erasing the medical debt of approximately 250,000 residents.