(Photo: Allison Bell/ALM)
A health insurance web broker has come up with a new way to get attention by doing good: It's contributing to a charity that buys portfolios of delinquent medical debt, then cancels the debt.
The web broker, GetInsured, announced earlier this week that it has contributed enough to the charity, RIP Medical Debt, to cancel $580,899 in delinquent medical debt in Nevada.
Earlier, the company worked with RIP Medical Debt to cancel $1.9 million in medical debt in California, and $1.1 million in medical debt in Minnesota.
Canceling medical debt can be an efficient way to reduce consumers' burdens: RIP Medical Debt says it can often get medical debt canceled for about 1 cent on the dollar. That means canceling $10,000 in debt could cost about $100.
RIP Medical Debt is organized as a 501(c)(3) charity. GetInsured and other donors can deduct contributions to the group from their taxable income.
RIP Medical Debt holds portfolio purchase costs down, and avoids helping patients who might have the means to pay their bills, by limiting itself to buying portfolios of delinquent debt owed by families that earn less than 200% of the federal poverty level.
Most of the families involved have debts that amount to 5% or more of their annual income, and most of the families have debts that are greater than their assets and are facing insolvency, according to RIP Medical Debt.
The group estimates that Americans now generate about $100 billion in delinquent medical debt each year.
In 2016, John Oliver, the host of HBO's "Last Week Tonight," reported that he'd been able to buy, and cancel, $15 million in delinquent medical debt for $60,000, or 40 cents per $100.
GetInsured's Message
GetInsured has been using its RIP Medical Debt contributions to communicate the message that consumers need to choose the right health coverage.
