Attorney General Keith Ellison, alongside Senator Liz Boldon and Representative Liz Reyer, has introduced the Minnesota Medical Debt Reset Act (SF 1347). This legislation proposes a one-time $5 million allocation to alleviate medical debt for hundreds of thousands of Minnesotans. The act partners with Undue Medical Debt, a nonprofit specializing in medical debt forgiveness. According to Undue Medical Debt, this investment could potentially erase around $500 million in medical debt affecting between 250,000 and 400,000 residents.
"When last year's Debt Fairness Act went into effect, I promised that helping Minnesotans with the burden of debt so they can afford their lives would remain a priority for my Office and these legislative champions," said Attorney General Keith Ellison. "The Minnesota Medical Debt Reset Act is the next phase of that crucial work."
Senator Liz Boldon highlighted the unique nature of medical debt compared to other types of financial obligations: “Medical debt isn’t like other types of debt,” she stated. Representative Liz Reyer added her perspective on the impact of medical debt: “We know that medical debt triggers additional forms of consumer debt and adds great stress to people’s lives.”
The initiative aims to provide relief without requiring applications from individuals. Instead, qualifying Minnesotans will receive notification by mail when their debts are forgiven. The program does not create any tax liabilities or obligations for those who benefit from it.
Undue Medical Debt collaborates with healthcare providers and commercial buyers to purchase uncollectable debts at discounted rates before forgiving them. CEO Allison Sesso expressed enthusiasm about working with Minnesota's legislature: “Building on our work with the city of Saint Paul, it’s exciting to see state-funded medical debt relief moving ahead in the Minnesota legislature.”
Saint Paul Mayor Melvin Carter has already partnered with Undue Medical Debt using American Rescue Plan funds to relieve city residents' debts. He emphasized the importance of eliminating barriers that prevent access to necessary care: "When even one of our neighbors struggles to access medical care, the health of our entire community suffers."
The act follows discussions initiated in 2024 after implementing the Minnesota Debt Fairness Act aimed at reforming state collection practices.