Howard Fischer
Another more than $200 million in medical debt has been wiped out for Arizonans, who will receive letters crediting Gov. Katie Hobbs.
The new figure was announced Monday by Allison Sasso, the president and CEO of Undue Medical Debt. The company agreed earlier this year to use some $10 million in state American Rescue Plan COVID relief dollars to buy up medical debt from hospitals and doctors for a few pennies on the dollar, eliminating a negative mark on the credit reports of those who racked up the bills.
All totaled, according to the Governor’s Office, the program has so far erased $642 million owed by more than 485,000 Arizonans.
Under a deal the state cut with Undue Medical, the beneficiaries all get letters crediting not jut United Medical but also Hobbs.
People are also reading… Tucson Mayor’s son, 19, faces DUI charge Arizona’s marijuana law could be sent back to voters Proposal: End speed limits on some Arizona interstates 3 Shake Shack locations coming to Tucson area Tim Steller’s column: Death shows risk in stopping brazen Tucson shoplifters On Tommy Lloyd’s ‘ethical’ Wildcats, a lingering concern for Becky Burke, more | Michael Lev Tucson’s ‘middle housing’ plan to span entire city Pedestrian struck, killed on I-10 east of Tucson Arizona football transfer portal tracker: updated look at outgoing, incoming Wildcats Rarely used freshman Sidi Gueye can ‘catch up fast,’ Arizona coach Tommy Lloyd says Southern Arizona’s newest area code on horizon 40 exciting things to do in Tucson December 19-21! ⭐ A list of places that will be open on Christmas Day 2025 Rep. Grijalva: Review U of A prof Chomsky’s ties to Epstein Tobe Awaka and Arizona basketball’s rebounding machine keep mowing down opponents
United Medical has been offering its program across the nation. Established in 2014, it uses government funds and private donations to acquire portfolios of medical debt from health-care providers or debt buyers.
The money goes farther, according to company officials, because the debt has reached the point where those holding the rights are willing to sell them for pennies on the dollar.
People can’t apply for the relief. Instead, Undue Medical has to find them.
The program is aimed at those whose income is less than 400% of the federal poverty level. That is currently $128,600 for a family of four.
Also eligible are those whose medical debt is 5% or more of their annual income. That would aid those who have higher income levels than the cutoff, but much higher debt than they may be able to handle.
Undue Medical works with a credit reporting agency, buying what it calls “relevant income data” from them. That’s how it gets the names of individuals who owe money.
That is then compared with the information it gets from medical providers and others who are the holders of past-due debts.
Once the bills have been paid off, the patient gets a letter in an Undue Medical envelope informing for the first time that the obligation has been wiped out and the credit bureau has been notified.
The deal Hobbs cut with the charity when she first signed the deal in 2024 also requires that beneficiaries be told the financial relief is happening because of the governor’s action: It spells out that any fliers, advertisements, press releases or other marketing materials include “logos or insignia as required by the governor’s office and approved by the governor’s office before publication.”
Gubernatorial press aide Christian Slater, in defending that provision when the program was announced in July, said that is appropriate. He said the letters are designed to tell people not just that their medical debt was relieved but “how it happened.”
“The medical debt relief would not be possible without the governor’s leadership and focus on lowering costs and delivering economic opportunity for every Arizonan,” Slater said.
Undue Medical said what’s also crucial is that the patient starts from scratch.
Generally speaking, when a debt is forgiven, it can be considered income for tax purposes. But Courtney Story, the charity’s vice president of government initiatives, said in July that doesn’t apply when the money comes from a “disinterested third party.”
“Because we’re a nonprofit, we’re not part of the health-care system, we count as a disinterested third party, as does the government,” she said. Ditto, Story said, with private donors, though they have the option of remaining anonymous or disclosing their names to recipients.
In the news release Monday, Hobbs included the anonymous comments of three Arizonans who said they were thankful the debt had been wiped out.
The contract the state has with Undue Medical says “patient stories and related insights shall be shared with the governor’s office on a regular basis.”
As to what the governor can do with those testimonials, a company spokesman said when the program was announced that, “to my knowledge, there isn’t a restriction on how they can be used.”
In unveiling the plan in 2024, Hobbs said there’s nothing illegal about the state using money it received from the federal government to pay off the medical debts of private Arizonans.
A provision of the Arizona Constitution makes it illegal to “make any donation or grant, by subsidy or otherwise, to any individual, association or corporation.”
“I can assure you we would not be taking this action if we weren’t fully confident in the legality of it,” Hobbs said. Anyway, she said, Arizona wouldn’t be the first jurisdiction to use COVID dollars from the American Rescue Plan Act in this way.
Undue Medical has provided news releases from other jurisdictions that have taken advantage of the program, with recent releases from Delaware Gov. Matt Meyer, Gov. Ned Lamont of Connecticut, Illinois Gov. JB Pritzker, and one from the Los Angeles County Board of Supervisors for a local program.
Howard Fischer is a veteran journalist who has been reporting since 1970 and covering state politics and the Legislature since 1982. Follow him on X, Bluesky and Threads at @azcapmedia or email [email protected].
Subscribe to stay connected to Tucson. A subscription helps you access more of the local stories that keep you connected to the community.
Get Government & Politics updates in your inbox!
Stay up-to-date on the latest in local and national government and political topics with our newsletter.
Sign up! * I understand and agree that registration on or use of this site constitutes agreement to its user agreement and privacy policy. Howard Fischer
