Californians owe more than $400 million in medical debt and it’s been said it is the No. 1 cause of bankruptcy in America. Here in San Diego, it’s estimated more than 464,000 people have medical debts noted on their credit reports, totaling more than $670 million.
“One round of chemo is roughly $13-15,000,” Cheryl Pascarella from Ramona said, “I had 24 rounds.”
Pascarella said she knows what it’s like when the medical bills pile up from her experience 10 years ago when she was diagnosed with breast cancer. Pascarella is fortunate, her insurance has helped her keep up with the mounting medical debt but she says she has seen others who were not as lucky.
“I watched a woman die because she couldn’t pay for her treatment,” Pascarella said, explaining a patient she met while undergoing chemo treatments.
“You’re one illness away or accident away from financial ruin in this country,” Craig Antico, founder of RIP Medical Debt, said.
Antico used to be a debt collector and said business was good because so many Americans have medical debt. If you can’t pay it down, Antico said your debt can be bought and sold to collections for pennies on the dollar.
For $10, a collection agency can purchase $1,000-worth of medical debt. That amount increases at 12 percent interest annually.
In 2014, Antico switched sides and started RIP Medical Debt, a charity that uses donations to purchase medical debt portfolios, just like collection agencies, except RIP Medical Debt doesn’t collect on it. They forgive the debt.
“We actually put it in our debt cemetery and it's history,” Antico said. “No one can ever collect on it again.”
RIP Medical Debt cannot specifically choose the individuals who get help, rather the charity creates broad guidelines to ensure the medical portfolios they are forgiving are for those needing the most help.
“Their assets are worth less than their liabilities,” Antico said.
NBC 7 Responds is making a difference in San Diego. Our company, NBC Universal Owned Television Stations, is making a donation to RIP Medical Debt that will buy and forgive one million dollars in medical debt here locally and $15-million nationwide.
NBC cannot choose whose medical debt will be purchased but those who receive a yellow envelope in the mail with the words RIP Medical Debt written on the front will receive details on the debt that was forgiven.
While we are donating to help people dig out from medical debt, we are also encouraging our viewers to help donate as well. To learn how you can donate, click here.