How Your Medical Debt May One Day Magically Disappear

Remember those angry college kids sleeping in Zuccotti Park to protest against Wall Street? They want to own your debt.

Remember Occupy Wall Street? When the young activists finished camping out and switching banks, some of them turned to more practical goals.

One group of them formed a financial services cooperative and plan to launch an Occupy-branded debit card. Others started wiping out people’s medical debt.

The latter operation, called the Rolling Jubilee, has been running for a year now. During that time, it has received more than $633,000 in donations — and erased a whopping $14.7 million in debt, according to the people running it.

How do they do it? They solicit donations, then use the money to get between the hospitals and the debt collectors. They buy up debts in bundles for pennies on the dollar of what’s owed, and then cancel them. They just say: You owe us nothing. Poof, debt gone.

“In the Jubilee’s latest and largest debt buyout in May, they purchased a $12 million bundle of medical debt for just under $250,000, relieving some 1900 consumers of an average of $6,400 worth of debt each,” Yahoo Finance says. The average donation fueling that purchase was $40.

You can’t ask them for help — the Rolling Jubilee can’t track down specific debts because of the way they’re bundled, Yahoo Finance says. The group learns the names included only after purchasing a bundle, and then it tries to contact those people. It chose to focus on medical debt first because that’s the largest source of U.S. personal bankruptcies. But if you have outstanding medical debt, maybe you’ll get lucky.

“It’s like winning the lottery without ever knowing you entered,” Yahoo Finance says.

Stacy Johnson

It's not the usual blah, blah, blah

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  • Al Seaver

    Wonder if we could do that with the national debt?

    • Draftdog

      We’ve been trying to do that with what is called taxes. Only problem is congress racks up dept faster than they can collect the taxes!

  • Medicine-is-My-Game

    It’s such a good idea – selfless for something so important.

  • Paula

    As nice as this is for those whose debt “magically disappears” we need to remember that most likely the debt that is owed to the doctors and hospitals will simply get added on to the price of the procedure we have scheduled next month. They don’t just “write off” debt, often they make it up somewhere else. Hospitals and doctors have bills and overhead to pay, and they cannot write off every debt or they would go out of operation.

    Remember, somebody somewhere is ALWAYS paying for the stuff that looks “free”. My daughter has to take 2 very expensive drugs every month. Thankfully, I have insurance which pays for a lot of the cost, but I still have a sizable outlay of cost that is my responsibility each month, in addition to the premiums I pay.

    It really makes me angry when drug companies advertise with the following: “if you are unable to afford your medication “drug company name” may be able to help.” In other words, “they” give it away to some. When a pill costs $1 to make, and a lot of people get it for free, some people pay $5, and I (or my insurance company) pay $25 for it, who is really helping the needy…the drug company or me? I believe it is a shame that Obamacare did nothing to establish guidelines for costs in different areas of our country. The cost of a “pill”, for example, should be established, and everyone should know what that is, including those who are getting it for “free”. We should still pay for it for those who need it and can’t afford it, but the notion of “free” or “magically disappearing” needs to be eliminated. There is no such thing as free, or “magic” when it comes to paying these bills. If you get your medical debt eliminated, know that someone somewhere paid it for you, and they may not be in much better position to pay it than you are.

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