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American Focus > Blog > Health and Wellness > Medical debt forgiveness could mean big paydays for hospitals
Health and Wellness

Medical debt forgiveness could mean big paydays for hospitals

Last updated: September 15, 2024 4:35 am
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Medical debt forgiveness could mean big paydays for hospitals
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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.

This article is part of STAT+, an exclusive subscription service that provides in-depth coverage of healthcare and life sciences news. Subscribers gain access to daily intelligence on Capitol Hill and the industry, among other benefits.

For unlimited access to award-winning journalism and exclusive events, consider subscribing to STAT+. Unlock this article and more by choosing from one of our individual or group subscription plans. View all available plans to find the one that best suits your needs.

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.

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