Atrium Health, the largest health system in North Carolina, recently made a strategic decision that paid off handsomely. Initially uninterested in canceling its patients’ medical debt, the health system changed its tune when the state government offered billions of dollars in incentive payments.

While other health systems across the country have accepted mere cents on the dollar to cancel unpaid medical bills they likely wouldn’t have been able to collect on anyway, Atrium Health held out for a better deal. Cook County, Illinois, for example, is aiming to pay just one cent per dollar to cancel an estimated $1 billion of medical debt.

In North Carolina, Atrium Health’s persistence paid off. As part of the state’s new Medicaid expansion program, hospitals will now be reimbursed in full for erasing $4 billion in medical debt. This initiative utilizes federal funds and also includes certain requirements for hospitals to enhance their financial assistance programs for individuals with low incomes.

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By leveraging federal funds and implementing financial assistance requirements, North Carolina’s Medicaid expansion program is not only benefiting hospitals but also helping to alleviate the burden of medical debt for individuals in need. Atrium Health’s proactive approach serves as a prime example of how strategic decision-making can lead to positive outcomes in the healthcare industry.