Bill > S0027

This bill establishes a comprehensive medical debt relief program in Vermont designed to help residents struggling with medical expenses. The State Treasurer will receive a $1,000,000 appropriation in fiscal year 2026 to contract with a nonprofit organization to purchase and eliminate medical debt for eligible Vermont residents. To qualify, individuals must either have a household income at or below 400% of the federal poverty level or owe medical debt that represents 5% or more of their household income. The contracted nonprofit will purchase medical debt from healthcare providers at fair market value, completely abolish the debt without tax consequences, and ensure the debt is removed from the debtor's credit report. Additionally, the bill prohibits credit reporting agencies from reporting medical debt and broadens the definition of medical debt to include various healthcare services. The legislation also requires that when medical debt is abolished, individuals must be notified about the amount of debt canceled, their household income relative to the federal poverty level, and information about financial assistance policies available at Vermont hospitals. These policies include 100% discounts for individuals at or below 250% of the federal poverty level and at least 40% discounts for those between 250-400%. The bill is set to take effect on July 1, 2025, and aims to provide significant relief for Vermont residents burdened by medical expenses.

Budget and Finance, Health and Social Services, Justice

https://legislature.vermont.gov/bill/status/2026/S.27