Legislation that protects families from the long-term financial consequences of illness and injury is now in effect in Delaware. Senate Bill 156 prohibits the reporting of medical debt to consumer reporting agencies and prohibits any medical debt from being included on a consumer report went into effect today.
The bill was passed unanimously in both chambers of the General Assembly in June and signed by Governor Matt Meyer at the end of July, when the governor announced a partnership between the State and national non-profit Undue Medical Debt, leveraging $500,000 in state funds to purchase and eliminate up to $50 million in medical debt for an estimated 17,000 or more Delawareans. Eligible Delawareans will be receiving letters in the coming weeks informing them that their debt has been eliminated.
Additional information from Gov. Meyer:Â Â
“When we remove barriers like medical debt from the equation, we strengthen Delaware’s families, communities, and economy,” Governor Matt Meyer said. “With this law now in effect, we’re helping thousands of Delawareans breathe a little easier and ensure that no one’s financial future is destroyed because they got sick or needed care.”
“Everyone knows how expensive medical care can be, and with Affordable Care Act subsidies expiring soon, those costs are about to become even more unaffordable for many families,” Rep. Kim Williams said. “That’s why this law taking effect now is so important.  It gives thousands of Delawareans a fresh start and eases the weight of medical debt, something that’s often beyond a person’s control.”
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Earlier this year, the Biden Administration finalized a rule that would remove medical debt from the credit reports of millions of Americans nationwide—about 15 million Americans would see $49 billion in medical debt removed from their credit reports. A lawsuit was filed challenging the rule, and the Trump administration ultimately rescinded the rule altogether.
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At the bill signing event, Governor Meyer also announced a partnership between the State of Delaware and national nonprofit Undue Medical Debt, leveraging $500,000 in state funds to purchase and eliminate up to $50 million in medical debt for an estimated 17,000 or more Delawareans. Eligible Delawareans will be receiving letters in the coming weeks informing them that their debt has been eliminated.
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This initiative was a key piece of Governor Meyer’s FY2026 budget.
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The debt relief initiative partners with the nonprofit Undue Medical Debt, which purchases bundled medical debt portfolios from hospitals and commercial debt buyers for pennies on the dollar and then abolishes that debt entirely — with no application process required. Qualifying Delaware residents will receive a letter from Undue Medical Debt confirming their relief.
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To qualify, residents must have an annual household income at or below 400% of the federal poverty level (about $100,000 for a family of three) or have medical debt that equals 5% or more of their annual household income.
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More than 100 million Americans are struggling with medical debt, much of which negatively affects their credit score, harming their chances of buying or renting a home, getting approved for a loan, or finding employment.
