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Churches Extend Practical Grace by Buying Debt

buying debt

Stories keep coming about churches partnering with RIP Medical Debt, a non-profit on track to eliminate $1 billion of debt by year’s end. The latest, featured on NPR, involves a team of Chicago-area congregations that’s raised $38,000 since summer—enough to wipe out $5.3 million in medical debt for almost 6,000 community members.

The Rev. Traci Blackmon, an executive with the United Church of Christ who also has a nursing degree, helped jump-start the pre-holiday campaign. Congregants were especially excited “about the opportunity to bless someone anonymously,” she says. The hope is to create a “ripple effect,” with beneficiaries eventually giving to others. But zero strings are attached to the debt forgiveness. “It’s not a recruitment ploy,” Blackmon says. “It’s just what we believe it means to be church.”

Buying Debt: The Story Behind RIP Medical Debt

Craig Antico and Jerry Ashton, co-founders of RIP Medical Debt, are former collection agency executives who became inspired by the Occupy Wall Street movement. In 2014, they started buying debt from medical collection agencies for pennies on the dollar. “Our only goal,” Ashton says, “is to see that that debt is taken off the backs of our fellow Americans.”

Medical expenses factor into about two-thirds of bankruptcies and contribute heavily to homelessness and poverty. Effects can be swift, Ashton notes: “You could walk in [to a hospital] having a great job, perfect credit, lovely home, and eight months later, you could qualify for charity.”

Ironically, one reason for RIP Medical Debt’s effectiveness is the overwhelmed collections system. There’s only one collector for every 8,000 hospital accounts, so by the time debts go to collections, recovery odds are low. Agencies, working on contingencies, are happy to receive even a portion of the total. “It’s an amazing windfall for them to get cash on accounts that have already been through four, five, six collection agencies,” Antico says. “That’s where the debt buyer comes in.”

RIP Medical Debt uses data to ensure they help “deserving” individuals, Antico notes. This includes people spending more than five percent of their gross income on medical bills, those making less than two times the federal poverty level, or those with more debts than assets. By using information for good, he says, the organization acts as “a predator giver.”

Adding Grace to the World

In 2019 alone, RIP Medical Debt has already partnered with more than 70 faith-based organizations. The non-profit—and contributing churches—sometimes hear back from overjoyed recipients. “We know we’re affecting people,” Ashton says, “and we’re grateful to our donors.” RIP Medical Debt is now working with universities on an economic-impact study of debt forgiveness. They’re also studying the issue’s mental, spiritual, and emotional angles.

The Rev. Matt Fitzgerald, whose Chicago congregation participated in the recent drive, knows how “miserable” it feels to dodge collections calls. “Sometimes it seems there is very little grace in the world—or at least, we don’t give each other much grace,” he says. “What joy to open a letter saying, ‘Your debt has been forgiven,’ instead of a letter saying, ‘We’re coming after you. Pay up.’”

The Rev. Otis Moss III, who helped coordinate the Chicago-area efforts, says, “We see Cook County as our parish. And our job is to ensure that you, in some form or fashion, will experience the compassion, the love, the care and the generosity that flows from God’s heart.” He adds, “You will receive debt forgiveness whether you are Christian, Muslim, Jewish, humanist, secular, agnostic, atheist, whether you’re black or you’re white. The only criteria that we laid out is that we want to make sure the most vulnerable are in line. Or as Scripture says, ‘The last shall be first.’”