Healthcare costs are the leading cause of bankruptcy in the United States, with a new survey revealing that 12% of Americans were forced to borrow money to cover medical expenses in 2024, despite having health insurance. Allison Sesso leads one of the largest efforts to relieve this burden as the president and CEO of Undue Medical Debt. “The majority of healthcare debt today is for insured folks,” she says. “Deductibles, copayments and out-of-pocket costs are simply out of alignment with most families’ means.”
To lighten the burden, her nonprofit uses donations to purchase large, bundled medical debts at a discount from debt collectors and healthcare providers, and relieves it. Thanks to a $50 million unrestricted gift from philanthropist MacKenzie Scott paired with other donations, in April the organization was able to fund its most impactful abolishment to date: a $30 billion debt purchase belonging to 20 million people. With estimates suggesting that total U.S. medical debt is $220 billion, that makes a 14% dent in the leading cause of bankruptcy.
“We’re busier than ever as appreciation for this issue grows and frustration around the unaffordability of healthcare in the United States deepens,” says Sesso. “With the future of the Consumer Financial Protection Bureau in jeopardy, and the associated rule to remove all medical debts from credit scores, this work is more important than ever.”
Sesso is now working with more than 20 state and local governments to locate and erase medical debt for their most financially burdened residents. What she likes best about this effort is the way they work in tandem with other solutions aimed at reducing the amount of debt created in the first place. “In North Carolina, for example, they expanded Medicaid access and adopted a variety of policies to prevent medical debt and paired it with our debt relief model,” says Sesso. In 2025, the state of Illinois announced that a pilot program in partnership with Undue Medical Debt resulted in erasing nearly $350 million of medical debt in the state. The program will now continue in the state next year, with the aim to erase over $1 billion.
“We are in this strange place where we love helping people and are striving to get access to as much debt as possible so we can erase it, while simultaneously being fully frustrated by just how broken our healthcare finance system is, which drives us to push for a better system that would make our work obsolete and ultimately, put us out of business,” says Sesso.