Paying off people's medical debt has little impact on their lives, study finds

A nonprofit group called R.I.P. Medical debt has relieved Americans of $11 billion in hospital bills. But it didn't improve their mental health or credit scores, according to one study.

Over the past decade, R.I.P. Medical Debt has grown from a small nonprofit group that received less than $3,000 in donations to a multimillion-dollar force dedicated to healthcare philanthropy.

He did it with a unique approach and simple strategy to tackle the enormous sums Americans owe to hospitals: buying back old bills that would otherwise be sold to collection agencies and erasing the debt.

Since 2014, R.I.P. Medical Debt estimates it has eliminated more than $11 billion in debt thanks to large donations from philanthropists and even municipal governments. In January, New York City Mayor Eric Adams announced plans to donate $18 million to the organization.

But a study released Monday by a group of economists questions the premise of high-profile charity. After tracking 213,000 people in debt and randomly selecting a few to work with the nonprofit group, researchers found that debt relief did not, on average, improve mental health or ratings. credit of debtors. And those whose bills had been paid were just as likely to forgo medical care as those whose bills remained unpaid.

"We were disappointed," said Ray Kluender, an assistant. professor at Harvard Business School and co-author of the study. "We don't want to water it down."

Allison Sesso, R.I.P. Medical Debt's executive director said the study contradicted what the group had regularly heard from those it had helped. “We are getting feedback from people who are delighted,” she said.

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