Millions of Americans are burdened by medical debt — but solutions are emerging. In this conversation, Undue Medical Debt's Allison Sesso, president and CEO, and Eva Stahl, vice president of policy, engagement and research, share how the organization has helped eliminate over $27 billion in patient debt, and how hospitals are partnering with Undue Medical Debt to help relieve financial burdens for patients. Hear actionable strategies and ideas that are key to improving patient financial health.
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00:00:00:01 - 00:00:13:18
Tom Haederle
Welcome to Advancing Health. 7 in 10 U.S. adults say they receive medical bills they can't afford. In today's podcast, meet two experts who say the system just can't go on like this.
00:00:13:21 - 00:00:36:12
Molly Smith
Hello everyone! My name is Molly Smith. I am the group vice president for public policy here at the American Hospital Association, and I am really pleased to have with me two leaders from Undue Medical Debt, Allison Sesso and Eva Stahl, who are here to talk to us today a little bit about how Undue Medical Debt works, particularly how they work with hospitals.
00:00:36:14 - 00:00:56:28
Molly Smith
And just, you know, their ideas about what we can do around the challenges associated with medical debt, both prevention and solutions, once it occurs. So really excited to have them here with me today. So at this point, I would love to just actually turn it over to you both, Allison and Eva. And please just kind of start by introducing yourselves.
00:00:57:00 - 00:01:26:15
Allison Sesso
Great. So glad to be here. My name again is Allison Sesso. And I serve proudly as the CEO and president of Undue Medical Debt. And we really have one mission. We're a nonprofit that relieves medical debt, and our mission is to end medical debt. And we do that both by working directly with hospitals. We've been able to work with over 70 unique systems, representing about 300 plus hospitals across the country buying medical debt.
00:01:26:17 - 00:01:58:12
Allison Sesso
This is the bad debt portfolios that sit on their books that we understand a lot of hospitals have written off and think that they're not creating any harm for patients. But what we've learned is that by getting rid of that debt, we are actually relieving a burden from people. Not only does it live in their like mental health space in their heads, but it actually is, something financially that is hurting them as well because they're always thinking about what they can be doing, how else they could be kept figuring out how to pay that bill, and it creates a sense of overwhelm for them.
00:01:58:12 - 00:02:21:10
Allison Sesso
So our mission really is to get rid of those debts for our patients. We've gotten rid of $27 billion of medical debt for over 15 million patients at this point. And that work just keeps growing. We work like a for profit debt buyer, except that when we get our hands on those debts, we relieve them. We never ever collect a single penny from a patient.
00:02:21:10 - 00:02:41:08
Allison Sesso
We would never do that. We focus on people that are 400% of poverty below, or if a debt or 5% or more of their income. And the reason why I brought Eva here today is because we understand that fundamentally, what we're doing is not solving the problem of medical debt in its creation in the first place. And that is something we really like to do.
00:02:41:09 - 00:02:54:03
Molly Smith
We like to think about how we can be bolder and bigger in terms of making sure that our work absolutely is obsolete one day by solving this problem more fundamentally. And so I'll let Eva introduce herself.
00:02:54:05 - 00:03:16:21
Eva Stahl
Sure. And I actually was brought on to Undue Medical Debt about three years ago. And I think it is it was really anchored in Allison's background in social services, but really a longer term vision for not just being a Band-Aid for people in the moment, but really thinking about how we could influence policy upstream and mitigate the harms of medical debt.
00:03:16:24 - 00:03:53:14
Eva Stahl
So with that, we really focus on listening to our patients. So we hear from patients. So Allison mentioned that we've abolished debt for over 15 million individuals and we hear from them. So we actually have an anthropologist that works for us and helps to listen to their stories and record them and find themes. So those are messages that we can take back both to our hospital partners, but also to policymakers that are interested in learning about that experience and really the most harmful parts of medical debt, which include mental health harm and stress, but also delaying and deferring and forgoing care.
00:03:53:16 - 00:04:03:16
Eva Stahl
And being constantly worried about their financial well-being. So, and that's largely due to, you know, very high out-of-pocket costs and coverage that is not really serving as coverage for them.
00:04:03:23 - 00:04:14:05
Molly Smith
So maybe we could start at the beginning, if you will, which is, maybe helping us understand a little bit about the situation that many Americans are facing with medical debt.
00:04:14:07 - 00:04:27:14
Molly Smith
You just mentioned some pretty, kind of eye popping numbers that you've helped 15 million people relieve $27 billion worth of debt. But what does medical debt look like in the U.S. right now?
00:04:27:17 - 00:04:37:20
Allison Sesso
Yeah. So it is a substantial problem. I think it's something like 1 in 4 Americans have medical debt of some form, how it shows up for them, you know, is it on a credit card?
00:04:37:20 - 00:05:03:21
Allison Sesso
Is it money borrowed from a friend or family? Is it sitting with the hospitals, etc., being written off? It's all bundled together and there unfortunately aren't really great numbers as to specifics. But KFF has put some numbers out that it's at least $220 billion problem. We obviously know that we're going in the wrong direction on this issue as well, because coverage really is the best solution to protecting people from medical debt.
00:05:03:21 - 00:05:23:24
Allison Sesso
And we have made some policy decisions in Washington, to your point, that have really undermined, I think, the coverage situation for way too many people and we've seen, you know, that those numbers just starting to unravel right now. So really, I think the problem is it's large to begin with, and it's only about to get worse.
00:05:23:27 - 00:05:49:06
Allison Sesso
And it's a very, very common American problem, which is why I think that there's so much conversation around this affordability question. And I think the problem for a lot of the people that we help and we hear this from constituents all the time, is they want to pay their bills. But the gap between what they're expected to pay and what they actually have in resources is just way too wide and wider.
00:05:49:12 - 00:06:16:00
Allison Sesso
So while coverage is the best answer, good coverage that actually doesn't rely on them to pay out-of-pocket costs that they no way they can afford, is really an important, I think, element of this. And what we're seeing is a really big and surging under-insurance problem. And now I think increasingly we're going to see, more people with no insurance at all as well, because premiums are just way too high and out of reach for people.
00:06:16:02 - 00:06:39:13
Molly Smith
So this issue of coverage being the fundamental kind of, base protection against medical debt. And yet, you know, we're at a point in time where, you know, around 90% or so of Americans have health care coverage. So I'm wondering if you could just be a little more specific about where it is that we're really falling short in terms of that coverage?
00:06:39:13 - 00:06:48:03
Molly Smith
So, you know, the 10% who are uninsured, but then you just used this term, underinsured, and maybe you could just provide a little bit more color about what that looks like.
00:06:48:05 - 00:07:04:06
Eva Stahl
When we talk about under insurance, that's pretty much saying that somebody has insurance, but it's not really protecting them, right? So it feels useless, right. But really, I think from a granular perspective, it means that people are spending more than 10% of their income on health care expenses.
00:07:04:06 - 00:07:30:15
Eva Stahl
Right? So that tends to be the more formal definition. But increasingly, when people walk through the door of a hospital or emergency room, rather, and they have a $5,000 deductible, but their earnings in no way allow them to pay or meet that deductible, right? They're under-insured because their insurance is actually not serving them or protecting them. And so increasingly, as we see increased rates and take up around high deductible health plans, right,
00:07:30:15 - 00:07:58:12
Eva Stahl
and a move certainly in the proposed rule that came out this spring to increase access to catastrophic coverage with very high out-of-pocket costs, it means that people at low incomes, low and middle incomes that don't have that kind of cash on hand will be able to use their health insurance without accruing medical debt. So we think that that is just a move in the wrong direction, because hospitals then end up having to absorb those losses.
00:07:58:15 - 00:08:12:05
Molly Smith
You know, and I think that even some of the latest data from the federal government regarding enrollment in the marketplace plans for 2026 shows double digit increase in people who are enrolled in bronze plans, which
00:08:12:08 - 00:08:32:07
Molly Smith
in theory, are supposed to protect from catastrophic costs. But I think what we're hearing is that even those, you know, really high deductibles, coinsurance, you know, that comes along with some of those plans people just simply can't afford. So let's play this out. So an individual in your scenario comes to the hospital. They let's say they have one of these high deductible health plans.
00:08:32:07 - 00:08:57:06
Molly Smith
They're facing a $5,000 kind of, out of pocket, contribution towards their care. They can't they can't pay that bill. You know, kind of goes through the process. And now it's kind of qualifies as medical debt. You mentioned that you work with hospitals to help alleviate some of this medical debt where you can. Can you tell me a little bit more about what that process looks like to work with a hospital on this?
00:08:57:08 - 00:09:15:29
Allison Sesso
It's relatively similar to working with with an outsource collections entity, if you will, right. Usually it's after that you've done that already. So there's been attempts to collect, a recognition that there's not going to be an ability to collect, because again, the difference between what the person actually owes and what they have is pretty vast.
00:09:16:01 - 00:09:33:04
Allison Sesso
These are not people have been put on payment plans, but people who are really just not able to pay and aren't, aren't paying anything towards the bill. So that goes into the bad debt file that's been written off by the hospital, written down to zero. We go ahead and we take a look back. We go back seven years.
00:09:33:07 - 00:09:55:10
Allison Sesso
And we do an analysis sort of like presumptive eligibility, like this very similar approach. We identify based on income everyone that is 400% of poverty or below. It is by far the vast majority of the people in the file. If someone said is particularly large and it's 5% or more of their income and they're above that threshold, we will also flag them.
00:09:55:13 - 00:10:14:23
Allison Sesso
We will price the debt. The debt is priced similar to the market. So because these people are unable to pay, you know, in the for-profit debt buying market, the chances of you collecting is very low. So the pricing is very low. Working with us is not going to be a windfall for hospitals. They do get some revenue and that's great.
00:10:14:25 - 00:10:40:11
Allison Sesso
But it's pennies on the dollar. So we do pay pennies on the dollar for these debts. The younger the debt, the more we'll pay. But you know, in general, $1 of, of a donation to us, is $100 on average of medical debt. And, and this is my favorite, most important part is we notify all those patients that the debts have been relieved, and that they then feel confident and comfortable going back to the doctor to getting that, that care that they need.
00:10:40:11 - 00:10:58:19
Allison Sesso
Because we do know that that really is a big barrier to care, which really undermines sort of the purpose of the health care system and the hospitals in the first place. And I think that that's one of the main benefits that hospitals see in working with us is the fact that this removes that barrier to care that they want to see removed.
00:10:58:24 - 00:11:06:21
Molly Smith
There's so many things there that I want to circle back to. But before we go there, you talked about every dollar that you spend. Whose dollars are these?
00:11:06:24 - 00:11:30:15
Allison Sesso
Yeah. So it's a great combination. We have so many donors. There's churches that love working with us that we can focus the debt relief to their communities. It's one of the things that our, proprietary debt engine, as we call it, does, is it actually puts every dollar to a specific patient where they are so that we can restrict their donation, if you will, to the patients living in a specific community, etc..
00:11:30:18 - 00:11:51:20
Allison Sesso
We do get increasingly governments. It's probably to nobody's surprised that governments are increasingly knocking on our door and asking us to work with us. We have about almost 30 government contracts we've completed to date, or in the midst of. And Eva, maybe this is a great time to bring you in to talk a little bit about, these conversations that you are having with policymakers.
00:11:51:22 - 00:11:59:26
Molly Smith
What are some of the things that you are seeing, whether it's state or federal officials thinking about in terms of trying to mitigate medical debt?
00:11:59:29 - 00:12:10:00
Eva Stahl
Sure. So I would say that we really see it as a window of opportunity to talk more broadly around some of the more challenging issues that these patients just along their medical debt journey.
00:12:10:02 - 00:12:48:21
Eva Stahl
And most notably, I would say that you've seen a lot of activity in states, particularly over the last 2 to 3 years. So these are things like, suing people or applying leans or wage garnishment. And that often it comes to top of mind for legislatures. And there is a lot of bipartisan agreement, in that area of extraordinary collection actions, there are other, efforts to, put up guardrails around financial assistance policies, whether that's, applying some thresholds around who should get financial assistance, when they should get financial assistance and when they should be screened for financial assistance or move to debt collection.
00:12:48:24 - 00:13:15:01
Eva Stahl
And then I think we've seen not as much work in the area of health insurance coverage, which we'd like to see more. Unfortunately, a lot of steps are being taken to erode coverage, which will lead to more medical debt. So that of course is frustrating. And then I think, you know, you can't not talk about what is the, you know, most common talking point right now, which is around price transparency, which we're seeing a lot of efforts pop up in various states out of people.
00:13:15:01 - 00:13:26:24
Allison Sesso
I think, you know, states feeling like they want to take action on the cost of health care. And seeing that as a silver bullet, which we don't believe that it is, but it certainly is where there's some interest in movement.
00:13:26:27 - 00:13:37:16
Molly Smith
Yeah. And I think, you know, this point of financial assistance, clearly that is such an important function and benefit that hospitals when they can provide it to their patients, do.
00:13:37:16 - 00:14:02:15
Molly Smith
But I think that the one of the points that you're sort of alluding to is that it can't be the solution to medical debt, not least of which because there just simply isn't enough financial assistance in the country that could be made available to close some of these coverage gaps. You know, Eva, I don't know if you want to talk at all about some of the things you guys have thought about in terms of ways that we could improve coverage to try to prevent this upstream.
00:14:02:17 - 00:14:21:15
Eva Stahl
I mean, I would just say and reiterate, Molly, what you just said, which is financial assistance is not health coverage. And so we need to stop treating it like that because it's an important backstop. I think that, you know, momentum toward something that would really help people on the ground that are experiencing medical debt is to have access to affordable, comprehensive health coverage.
00:14:21:18 - 00:14:45:04
Eva Stahl
So I think for us that we're open to whatever structure that might look like. But where the people that we represent and what's important to us is that any approach or policy or cost containment activity or whatever the spectrum of portfolio of options is that it actually is having a meaningful impact on people's out-of-pocket costs without sacrificing access.
00:14:45:07 - 00:15:06:23
Molly Smith
Yeah. So complicated is definitely, unfortunately, a word that we can use to describe many aspects of the health care system. I do want to ask you really quickly a little bit about presumptive eligibility for financial assistance, because I think that is something that you've done a lot of thinking about. So, could you tell me a little bit about your work around presumptive eligibility and what you think hospital should be thinking about in that space?
00:15:06:26 - 00:15:44:12
Eva Stahl
Presumptive eligibility for financial assistance, not to be confused with presumptive eligibility for Medicaid, is really just screening people much earlier in the medical billing workflow. So closer toward the point of service, rather than sifting through people that might be moving toward debt collection. So by screening people early, then you have the opportunity to, estimate their income or use other sources to identify their income and then decide if they are eligible for your financial assistance program and swiftly move them into financial assistance, reducing administrative burden for yourself downstream.
00:15:44:14 - 00:16:17:04
Eva Stahl
Right. And also offering a contactless and paperless option for patients. So we also know from the deep work we've done around financial assistance, that many people never even fill out the financial assistance application. They feel overwhelmed by it, or they're under duress because they're in the middle of a health episode. So this tool really being introduced early on in the workflow, allows for patients to swiftly move into those categories and before the first bill is dropped. And then they can be notified that they have access to free care or discounted care.
00:16:17:06 - 00:16:18:26
Molly Smith
Regarding presumptive eligibility,
00:16:18:26 - 00:16:39:23
Molly Smith
also, I think for our hospital listeners out there who might be interested in exploring these programs, I do want to note that both the AHA and I'm aware Undue Medical have resources available, including things like case studies where you could learn more about what it takes to implement a presumptive eligibility program. Eva, Allison, thank you so much for your time today.
00:16:39:26 - 00:16:54:19
Molly Smith
I really appreciate all of the information you just provided. That really important, really important work, just been very eye opening. Also, to really get to work with your team and learn from you and these various discussions about what the solutions are here. So thank you.
00:16:54:21 - 00:17:03:02
Tom Haederle
Thanks for listening to Advancing Health. Please subscribe and rate us five stars on Apple Podcasts, Spotify, or wherever you get your podcasts.



