This Nonprofit Buys and Then Pays Off Medical Debt

Posted by Matin Varshochi in MedicalAugust 19, 2022(Last Updated August 22, 2022)4 min read
Key Takeaways
  • When receiving medical care from a health care institution, a bill will follow, which has to be paid off. 
  • However, for some, paying their medical bills is not an option as the outstanding amount is too high compared to their income.
  • Fortunately, RIP Medical Debt, a nonprofit organization helps to payoff and forgive the medical debt.
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After receiving medical care, a bill must be paid off. Typically, if someone has health insurance, the insurance company will cover all or a portion of the bill. Some may have little to no income, which makes it hard for them to afford insurance, which leads to accumulating debt. Unfortunately, millions of Americans struggle with paying off their medical debt, which is why the nonprofit RIP Medical Debt is helping people all over the United States relieve their medical debt.


Concerning Facts About Medical Debt


Before discussing this nonprofit, here are some concerning facts to note about the current state of America’s medical debt crisis. First, an investigation by Kaiser Health News and NPR shows that 41% of Americans, or 100 million, currently have some form of medical debt. Additionally, according to the Centers for Medicare & Medicaid Services (CMS), the average medical bill was $12,350.


Past due hospital bill

Image Credit: MedstockPhotos /


In comparison, the median household annual income is around  $67,521, according to 2020 U.S.Census Bureau data. As a result, if a person were to require medical attention, they would receive a medical expense which is 18% of their annual gross income. Therefore, due to the high bills relative to a household’s income, it becomes easy for a cycle of debt to begin, which led to the following nonprofit established in 2014

Background on the Nonprofit that Buys Medical Debt

The nonprofit's name is RIP Medical Debt, founded by Craig Antico and Jerry Ashton. The founders used to work for a debt collection agency as debt collectors, and they used to call people who had unpaid medical bills hoping that they would pay them off.


However, after a couple of years of trying to get people to pay off their medical debt, they had a revelation and decided to set up a nonprofit organization to help those who could not pay their medical debts.


How the Erasing of Medical Debt Works


RIP Medical Debt operates by going on the secondary market and buying debt from hospitals. The debt owed by many patients is hard to collect, leading to hospitals selling these outstanding debts for pennies on the dollar. By selling them at a low price, the debt collection agencies who purchase them have the opportunity to make a profit by getting people to pay off their debt.


Recommended Read: Credit Bureaus Beginning to Remove Medical Collection Debt


RIP Medical Debt uses money raised through its website to purchase these debts. For example, philanthropist Mackenzie Scott gave $50 million to this nonprofit to support its efforts to remove people’s medical debt. RIP Medical Debt claims these donations have a 100x impact, meaning a $100 gift means $10,000 of medical debt will be forgiven.


breaking free from debt (debt-free concept)

Image Credit: blocberry /


So far, the nonprofit has removed $7.1 billion in medical debt, which has helped nearly four million Americans. Those eligible people who had their medical debt removed received letters in the mail from the nonprofit informing them they no longer had to worry about paying their medical debt. 


Type of People RIP Medical Debt Targets


RIP Medical Debt does not pick favorites. Instead, they focus on hospitals with outstanding debt and looking to sell them. That way, the process remains as general as possible, and there is no sign of favoritism. 


In addition to paying people’s medical debt, the nonprofit has also begun helping those struggling due to the escalating cost of living. The current economic conditions have caused some people to lose their jobs, making paying off debt much more difficult. As a result, RIP Medical Debt has begun expanding its eligibility. It is now purchasing the delinquent debt of those making up to four times the federal poverty level. 


The Harsh Reality of the Health Care System


Although RIP Medical Debt is helping millions of Americans overcome their financial burdens, it also shows the flaws in the current health care system. For example, Terri Logan, who had their health care debt removed by RIP Medical Debt, says that when she gave birth and faced a substantial bill, no one mentioned charity care or financial assistance programs to her. Her lack of information made dealing with this financial burden more challenging. 


healthcare cost medical bill paperwork

Image Credit: Valeri Potapova /


Allison Sesso, the current CEO of RIP Medical Debt, said the following regarding the hospital situation, "We prefer the hospitals reduce the need for our work at the back end. I would say hospitals are open to feedback, but they also are a little bit blind to just how poorly some of their financial assistance approaches are working out." 

Recommended Read: Healthcare Costs Are Increasing Despite Affordable Tactics

This quote by Allison Sesso discusses how the current hospital systems do a poor job of explaining the financial assistance some patients can receive to help their repayment process become easier. Consequently, the lack of guidance provided by these medical institutions played a role in the financial pressure created for these patients; which led to them struggling with paying off their bills and negatively affecting their credit score


The Money Wrap-Up

According to Kaiser Research, the outstanding medical debt in 2019 was $195 billion; this value has risen since then. However, with RIP Medical Debt, nearly four million Americans have seen their health care expenses erased. This nonprofit organization's actions should be a wake-up call for medical institutions to introduce more feasible repayment options.


Main Image Credit: Monkey Business Images /

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