There has been a lot of news lately about RIP Medical Debt, and momentum it has gained in the effort to buy and forgive … yes … medical debt for struggling consumers. This latest activity involves NBC4, the local broadcaster in the Washington, DC market, which is reportedly making a $15,000 donation to RIP, which will forgive $1.5 million in debt. NBC7 in San Diego made a similar announcement. Both stations are part of the parent, NBC and Telemundo Owned Television Stations Group, which today announced a  donation of $150,000.

As reported by NBC4, the individuals whose debt is forgiven is randomly determined based on eligibility criteria. They say there is no mechanism to apply to have their debt forgiven.

So for now, it’s a little like the folks who mysteriously give $100 bills to strangers on the street or in stores at the holiday times. It seems to always be totally unexpected, but extremely appreciated.

A new element associated with this current campaign is that the group is suggesting a way for those who have benefitted to pay it forward and help others; make a donation themselves to RIP.

You can learn more about RIP Medical debt here.

insideARM Perspective

insideARM has written about RIP on several occasions, following their progress since they came onto the scene in 2016. The partnership with NBC is significant in that it’s the first really scalable effort they’ve undertaken.

Most recently we published this story about a group of Michigan nurses who raised $10,000 to buy and forgive the debts of 500 patients.

In June 2017 we wrote about a team of researchers that convened in New York City to study the impact of medical debt forgiveness.

In December 2016 we published a Q&A addressing questions about the non-profit, how it works, where the money comes from, how it addresses HIPAA requirements, and more.

RIP Medical Debt gained attention in June 2016 when it became linked to an episode of “Last Week Tonight with John Oliver,” when Oliver dedicated the show to the debt-buying industry, and claimed to give away $15 million. He accomplished this by purchasing a medical debt portfolio for $60,000 and then had RIP manage the debt forgiveness so that it could be done without tax consequences to the patients.

Some of the articles about RIP explain that medical debts can be sold for pennies on the dollar, and then collectors attempt to collect the full amount. While this is technically true, what is also true is that the lion’s share of medical debt is not sold. Instead, healthcare providers either attempt to collect it themselves, or engage professional debt collection firms that specialize in working with patients to 1) assist in sorting through the bills they have, 2) identify possible sources of payment (including insurance, or application for charity care), 3) establishing settlements and/or payment arrangements in accordance with their client’s policy (the client may be a hospital, a physician, dentist, home health agency, skilled nursing facility, etc.); and 4) identify patients who may meet a healthcare provider’s standards for financial aid and work with those patients in applying to any applicable financial assistance programs the caregiver may sponsor. 

Legitimate collectors will tell you that they would applaud this effort. As a strategy, especially when working on behalf of non-profit hospital clients, it is important for collectors to help identify patients who do not have the ability to pay outstanding medical bills.  Collectors who are able to communicate with patients and/or their responsible parties prefer to focus their efforts on situations where there appears to be an ability to afford to pay. If there is an organization with an ability to resolve “unpayable” medical bills it would seem to be -- all the better for everyone involved – the patients, the healthcare providers, and the collectors.