Stacey Abrams group donates $1.34M to wipe out medical debts

The political organization led by prominent Democrat Stacey Abrams is branching out into paying off medical debts

ATLANTA -- The political organization led by prominent Democrat Stacey Abrams is branching out into paying off medical debts.

Lauren Groh-Wargo CEO of allied group Fair Fight Action and senior adviser to the PAC said paying off medical debt is another facet of the group's advocacy seeking expansion of Medicaid coverage in the 12 states that have refused to expand the health insurance to all poorer adults.

“What is so important about this is the tie between Medicaid expansion and just crushing medical debt,” Groh-Wargo said.

Of the states targeted, Arizona and Louisiana have expanded Medicaid.

Fair Fight said letters will be sent to those whose debts have been absolved to notify them. The purchase will forgive the debt of nearly 69,000 people in Georgia, more than 27,000 people in Arizona, more than 8,000 people in Louisiana, and about 2,000 people apiece in Mississippi and Alabama.

“I know firsthand how medical costs and a broken healthcare system put families further and further in debt," Abrams said in a statement. “Across the sunbelt and in the South, this problem is exacerbated in states like Georgia where failed leaders have callously refused to expand Medicaid, even during a pandemic.”

RIP Medical Debt said Fair Fight is giving the third-largest donation in its history. Philanthropist MacKenzie Scott gave the group $50 million last year. The group has aided more than 3 million people since it was founded in 2014, typically buying bundles of medical debt at steep discounts from the face value. The bills often are purchased from collection agencies that have been trying to get debtors to pay for years. The group has wiped out debt with a face value of more than $5.3 billion.

Allison Sesso, executive director of RIP Medical Debt, said such liabilities often drive people into bankruptcy, can deter people from seeking needed medical care, and can lead to wages being garnished or liens filed on property.

“I wouldn’t underestimate the mental anguish that people have from medical debt,” Sesso said.

Sesso said her group is not just pursuing debt abolishment “but thinking about how we can improve the system nationwide,” trying to advocate that hospitals should do more to make charity care available. She also said research shows states that expanded Medicaid have lower rates of medical debt.

“We are not the permanent solution," Sesso said. "There does need to be a larger solution around what we do about medical debt.”

Groh-Wargo said the money was given by donors for political action, but said the money represents “only a small percentage” of what Fair Fight has raised.

“I think of this as politically tithing to help the community we are advocating for and with,” Groh-Wargo said, saying the group has done smaller scale charitable efforts.

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A previous version of this report incorrectly stated the donation was coming from Fair Fight Action. The donation is coming from Fair Fight Political Action Committee.