The Montclair Interfaith Clergy Association is working to help residents clear their medical debts.

The association is raising money for RIP Medical Debt, a nationwide project that helps pay off medical costs for those who qualify. The association is targeting residents of Montclair and Bloomfield. 

“There’s a gross amount of injustice in recognizing that a significant amount of bankruptcy is medical debt,” said the Rev. David Shaw of Union Congregational Church, one of the participating congregations. 

Individual community groups, like the Montclair Interfaith Clergy Association, raise the money, and earmark that money for debt holders in a geographic area. RIP Medical Debt identifies how much medical debt exists, and among whom, uses the funds to clear the debt, and then notifies the families that their debt has been cleared.

It is estimated that the average American owes $2,200 in medical costs, Shaw said, citing data provided by RIP Medical Debt. For people who are already struggling to make ends meet, the collection process is an added stressor, he said. 

“It’s really crazy to think you’d be harassed by a debt collector because you had an issue that needed to be taken care of at a hospital or a doctor’s office,” he said.

As of Dec. 14, RIP Medical Debt had cleared $2.9 billion in debt for almost 2 million families nationwide. The national organization helps identify families in a given area that owe. And individual fundraising campaigns can be geared to target a specific geographic area, such as Montclair and Bloomfield, if there is a large enough amount of debt in the area.

A 2019 study from the Centers for Disease Control and Prevention found that about 14.5 percent of Americans did not have health insurance, the main reason being that insurance was not affordable. The average cost of a hospital stay can be $17,534, according to the organization 

The Consumer Financial Protection Bureau reports that roughly half of all debt collections are for medical debt, and a 2019 study published in the American Journal of Public Health found that as many as 66 percent of bankruptcies were tied to medical debt. 

Shaw said that better health insurance usually coincides with higher-paying jobs. 

The money raised through RIP Medical Debt is leveraged to take care of medical costs. One dollar, for example, can resolve $100 of medical debt.  According to RIP Medical Debt’s national website, the funds that are raised are used to purchase bundled medical debt portfolios – which hospitals often sell to debt collectors, who then try to collect money from the patients in the portfolios – at a fraction of their original cost. 

The organization is unable to provide direct assistance to individual families, since there may be thousands of portfolios in the bundles that RIP Medical Debt purchases. However, the organization also provides a list of resources that can help families reduce their debt, if it’s not in a portfolio. 

There is about $1.5 million of medical debt among Montclair and Bloomfield residents, Shaw said, based on data that RIP Medical Debt has compiled on debt in Montclair. If the campaign raised $15,000, it could resolve all of that debt, he said. 

As of Dec. 8, $6,000 had been raised.

The Montclair Interfaith Clergy Association started talking about RIP Medical Debt in January. “And then the pandemic hit,” Shaw said, which put the project on the back burner. But the group began revisiting the project this fall. 

Once a person’s debt is cleared, that person gets a letter of notification. And the relief that many then feel is very palpable, Shaw said. 

Union Congregational held special collections for the project during some of its services, and the church will also be holding a special Christmas fair as a fundraiser. 

If there are any funds left over after aiding residents in Montclair and Bloomfield, the group will broaden its approach to help residents in other parts of Essex County. 

Shaw said the clergy association was pleased about what had been raised, and hopeful that the $15,000 goal would be met. But, he added, it is unfortunate that the fundraising effort has to be necessary: Medical debt “is unjust and a great lament.” 

Those interested in donating may visit the association's fundraising page here.