I highlight places doing interesting things related to economic development, so maybe Cook County, Illinois’ decision to allocate ARPA funds to relieve medical debt for 73,000 people seems unrelated. But consider this – 2/3 of personal bankruptcies and 25% of credit card debt is estimated to be related to medical debt. That’s a lot of stress on households, and a lot of stress on the local workforce, even creating barriers for some who can’t satisfy an employer’s requirement for a clean credit record. Along with changes the credit reporting agencies are making in how they report this debt, programs like this can clear some hurdles that ultimately have nothing to do with how valuable an employee can be.
It’s rare to see the public sector participate directly in medical debt relief. The commitment in Cook County is to allocate $12 million in ARPA funds, which can be leveraged to erase about $80 million in debt, ultimately impacting almost 73,000 people. There are income requirements, up to 400% of the poverty level, or more than 5% of annual income. The County is partnering with an organization called RIP Medical Debt to administer the program. While the direct financial involvement of a unit of government is somewhat unusual, there are many examples on RIP’s web site of other models. Many feature faith communities or community foundations come together to lift up their neighbors and help their economy at the same time.