Arizona erases more than $1 billion in medical debt for nearly 671,000 residents
Gov. Katie Hobbs partnered with nonprofit Undue Medical Debt to buy and forgive hospital bills using no state funds
BY DAVID IVERSEN
Aug 5, 2026, 7:07 PM
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Gov. Katie Hobbs announced Wednesday that more than $1 billion in medical debt has been erased for nearly 671,000 residents through a partnership with the national nonprofit Undue Medical Debt
The initiative, which uses no state funds, targets Arizonans who owe at least 5% of their annual income in medical bills or earn at or below 400% of the federal poverty level
The nonprofit purchases bundled medical debt portfolios from hospitals and collection agencies for a fraction of their face value
Letters notifying more than 200,000 additional recipients will begin arriving this week. There is no application process. In fact, those eligible do not need to take any action
“We are restoring hope, dignity and peace of mind for hundreds of thousands of Arizonans,” Hobbs said in a statement
Medical debt in Arizona was previously estimated at $2.4 billion
