Posted on 03/09/2021 4:39:36 PM PST by nickcarraway
An Oklahoma church has purchased and forgiven millions of dollars in medical debt owed by Oklahoma residents.
Recently, Ada First United Methodist Church partnered with RIP Medical Debt to purchase and forgive $3.8 million in medical debt.
Health leaders say ‘vaccine hunting’ should subside with more supplies on the way The debt was owed by 1,327 residents in Coal, Garvin, Hughes, Pontotoc and Seminole counties.
“The global pandemic certainly required us to adjust our initial goal,” stated senior pastor Brian Matthews. “But even with that adjustment, we were able to forgive over $1 million more than we hoped. With RIP’s expertise, we were able to forgive roughly $380 in medical debt for every $1 donated.”
Medical debt is the main cause of bankruptcy in the United States, particularly in the midst of a global pandemic.
Oklahoma man dies after thief steals ambulance during emergency “Medical debt doesn’t discriminate. Anyone can get sick or be involved in a serious accident. I hope our church and others in the community can revisit this mission in the future, particularly when it provides such tangible benefits to our neighbors,” said Krystina Phillips, who coordinated the mission for Ada FUMC.
Organizers say they targeted households that are below twice the federal poverty level, insolvent or going through hardship.
Individuals whose medical debt was forgiven will receive notification in RIP’s signature yellow branded envelopes in the coming weeks.
Hopefully they bought the debt for pennies on the dollar.
In my opinion this is the kind of thing churches (with congregational approval) should be doing.
Medical debt is a huge scam.
Hospital charges a negotiated $1000 for a procedure if you have good insurance, but $12,000 if you are uninsured.
When 12k is not paid it is more than a $1000 tax writeoff for the hospital and the debtor is still pursued...
Except now they turned the people’s debt into taxable income.
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True,
So the $1000 procedure that was billed at $12,000 and settled for $500 would leave the debtor with a tax obligation on the 11,500 that was “forgiven”
And this resets the statute of limitations because now the debt is a tax obligation owed to the IRS.
Oops
It may not be. This debt was purchased by the church and forgiven as a gift from the church to the debtors. IRS publication 4681 deals with canceled debt. It states the following: "In most cases, you don't have income from can- celed debt if the debt is canceled as a gift, be- quest, devise, or inheritance."
At first, I thought this was a foolish use of church money, since the debt was probably a scam by the medical industry that could be negotiated by the debtors.
But then I saw how the church bought the $3.8 million of debt at the discounted price of $10,000. That is a small price for a lot of relief.
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