Hundreds of thousands of Arizonans are seeing medical bills wiped away through a statewide debt relief initiative that has now eliminated more than $1 billion in outstanding hospital debt.
Gov. Katie Hobbs announced the milestone Wednesday, saying nearly 671,000 residents have benefited from a partnership between the state and the nonprofit Undue Medical Debt. Rather than using public funds to pay individual bills, the organization purchases portfolios of medical debt from hospitals and collection agencies at steep discounts before canceling the balances.
Eligibility is automatic for people whose medical debt equals at least 5% of their annual income or whose household income is at or below 400% of the federal poverty level. Officials said there is no application process, and more than 200,000 additional notification letters will begin arriving this week for newly approved recipients.
The announcement represents one of Arizona’s largest medical debt relief efforts to date. With statewide medical debt previously estimated at $2.4 billion, the initiative has erased a substantial share of that burden while highlighting a growing national strategy in which nonprofits purchase and forgive medical debt instead of requiring government-funded repayment programs.
