Bernie Sanders Introduces Plan to Cancel $81 Billion in Medical Debt

And restore credit scores damaged by unpaid medical bills.

Senator Bernie Sanders campaigning at the University of North Carolina in Chapel Hill on Thursday. Preston Ehrler/SOPA Images via ZUMA

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Bernie Sanders not only wants to eliminate future medical debt with his plan for Medicare-for-All, he also wants to wipe the slate clean for Americans who already have debt from unpaid medical bills. On Saturday, the Democratic candidate announced an ambitious plan to eliminate $81 billion medical debt for Americans, reform bankruptcy laws, and even put an end to credit score agencies.

“The very concept of medical debt should not exist,” Sanders said in a statement. “In the wealthiest country in the history of the world, one illness or disease should not ruin a family’s financial life and future.”

Medical debt is a significant economic burden on millions of Americans —and though there is an academic debate over exactly how many bankruptcies are directly attributable to it, health care expenses are the largest single causes of bankruptcies nationwide. According to a 2014 report by the Consumer Financial Protection Bureau, half of all debt reported to credit agencies is medical debt, and one out of every five credit reports contains unpaid medical debt. It’s also a serious—though hard to measure—hazard to people’s health. A 2018 study from West Health and Gallup found that a quarter of all Americans had skipped a medical treatment due to cost.

Under Sanders’ plan, the government would negotiate and pay off $81 billion in unpaid medical bills that have been sold to collection agencies and are currently harming people’s credit reports. His plan would also limit the notorious tactics debt collectors engage in when they track people down and hound them to collect on the debts they have purchased. If implemented, the plan might also come well under its $81 billion price tag as debt sold to debt collectors is worth only a fraction of the original bill. 

In addition, Sanders’ plan would reform the 2005 bankruptcy law (the one Elizabeth Warren vigorously opposed and Joe Biden supported) so that it will be easier to forgive medical debt.

Finally, the proposal would stop medical debt from impacting people’s credit scores. Sanders would create a federal credit registry to rival and ultimately replace credit agencies like Equifax, and medical debt would not be factored into anyone’s score. “Credit scores also systematically perpetuate gaps in wealth and inequality between white and minority consumers,” the plan states. “We will establish a public registry that will end racial biases in credit scores and ensure those with medical debt are not penalized for the ‘crime’ of getting sick.”

On Twitter Saturday, Sanders’ campaign shared the experiences of some Americans weighed down by medical bills. 

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WE CAME UP SHORT.

We just wrapped up a shorter-than-normal, urgent-as-ever fundraising drive and we came up about $45,000 short of our $300,000 goal.

That means we're going to have upwards of $350,000, maybe more, to raise in online donations between now and June 30, when our fiscal year ends and we have to get to break-even. And even though there's zero cushion to miss the mark, we won't be all that in your face about our fundraising again until June.

So we urgently need this specific ask, what you're reading right now, to start bringing in more donations than it ever has. The reality, for these next few months and next few years, is that we have to start finding ways to grow our online supporter base in a big way—and we're optimistic we can keep making real headway by being real with you about this.

Because the bottom line: Corporations and powerful people with deep pockets will never sustain the type of journalism Mother Jones exists to do. The only investors who won’t let independent, investigative journalism down are the people who actually care about its future—you.

And we hope you might consider pitching in before moving on to whatever it is you're about to do next. We really need to see if we'll be able to raise more with this real estate on a daily basis than we have been, so we're hoping to see a promising start.

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