An update on LFUCG’s Undue Medical Debt program

In Tuesday, January 13th’s Council Work Session, Council will receive a six-month update on the city’s partnership with Undue Medical Debt.

Undue Medical Debt (UMD) is an organization that purchases medical debt from healthcare providers like hospitals. Unlike debt collectors, UMD erases the debt with no strings attached, so people no longer need to pay that chunk of their medical debt. In 2025, LFUCG entered into a $1 million, three-year contract with Undue Medical Debt with the goal of forgiving $90 million in medical debt for Fayette County residents.

To be eligible, recipients must either:

• Live at or under 400% of the federal poverty line– for a single person-household in Kentucky, that’s $62,600. For a family of three, the cap is just above $100,000.
• Have medical debt totalling at least 5% of their annual household income.

Residents can’t apply for debt relief through this program. UMD purchases qualifying debt directly from healthcare providers, and eligible residents are automatically selected based on these criteria. Recipients receive a letter in the mail notifying them that their debt has been forgiven.

In November, LFUCG announced the program purchased more than $12.6 million in medical debt for 6,484 Fayette County residents. UMD says the cost was about $90,000, or only 0.7% of the total cost of the debt itself, bringing a 140:1 return on investment. The partnership with LFUCG still has over $900,000 left to spend.

During Tuesday’s presentation, council will receive demographic information on the people whose debts were abolished. For example, 82% of these beneficiaries earn above the federal poverty line.

Multiple beneficiaries have also shared their responses and testimonies, which will be shared during the meeting.

If you or someone you know had their medical debt abolished in this first wave, and you want to share your story, please reach out at anabel@nextcity.org!