Governor Proposes Erasing $1B in Illinoisans’ Medical Debt

May 4, 2024

If Governor J.B. Pritzker’s budget plan is approved, hundreds of thousands of people in Illinois could see their medical debt eliminated.

Medical debt is the leading cause of personal bankruptcy in Illinois and the U.S. It is estimated that medical debt accounts for nearly two-thirds of all bankruptcies nationwide and that around 14 percent of the people in our state have medical debt in collection.

Speaking at a press conference, Pritzker said, “Too many patients leave hospitals with their credit ruined or at risk of bankruptcy in the ensuing months, often through no fault of their own, all because our health insurance and our healthcare billing systems are a little bit broken.”

The governor’s plan, which is included in his proposed budget for the coming fiscal year, would set aside $10 million to settle $1 billion in medical debt for nearly 340,000 low-income Illinoisans. This would be the first phase of a four-year plan to wipe out $4 billion in medical liabilities. The governor’s plan mirrors a debt elimination program already in place in Cook County, where nearly $350 million in medical debt has been erased, helping about 200,000 residents.

At Nash Disability Law where we help people in the Chicago area and around Illinois get Social Security Disability benefits when health problems stop them from working, we see every day how much of an unfair burden huge medical expenses can be on hard-working, responsible people.

The governor’s budget proposal is not the only initiative to provide some relief for people overwhelmed by medical debt.

A bill introduced in the state legislature by State Rep. Steve Stadelman (D-Rockford) would prohibit consumer reporting agencies from incorporating any adverse information stemming from medical debt into consumers’ credit reports.

“Medical debt does not indicate one’s ability to pay their bills,” Stadelman stated on his website. “By prohibiting consumer reporting agencies from including adverse information related to medical debt in credit reports, we are working to alleviate financial burdens and promote economic stability for individuals and families across our state.”

Stadelman’s proposal is now in the House for further consideration.