Orange County erases $758M in medical debt

Orange County officials announced on Tuesday that the local government has cleared $758 million in medical debt for 515,000 residents. This total exceeds the county's original projection of 500,000 people who would benefit from the initiative.

The program launched in 2024 with an initial investment of $4.5 million. County commissioners approved the spending after a period of skepticism regarding the feasibility of the approach. The county added another $2 million in August to target 100,000 additional residents.

Undue Medical Debt, a nonprofit organization, administers the relief effort. The group buys medical debt from collectors and providers at a discount. Undue states that every dollar invested can eliminate an estimated $100 in patient debt on average.

The funding comes from the American Rescue Plan Act of 2021. The county received $270 million in federal funds, which must be spent by the end of this year. The medical debt program uses a small portion of these funds, a decision made after advocates from Central Florida Jobs With Justice pushed for the initiative.

Eligibility is based on household income. Residents qualify if their income is at or below 400 percent of the federal poverty line. In 2026 terms, this cap is $63,840 for an individual or $109,280 for a family of three. Some residents also qualify if their medical debt exceeds 5 percent of their annual income.

There is no application process for residents. Undue identifies eligible individuals by working with local healthcare providers such as Orlando Health. The organization then mails a letter to notify residents that their debt has been cleared.

Raquel, a single mother and teacher, shared that $300 of her medical debt was erased. She described the relief as helping her rebuild her credit and manage her finances as a single parent on a teacher's salary.

Allison Sesso, president and CEO of Undue Medical Debt, said the partnership helps families avoid financial ruin due to illness. The organization, formerly known as RIP Medical Debt, was founded by former debt collectors who shifted their focus to resolving patient balances.