Experts partnered with RIP Medical Debt, a medical non-profit that buys and forgives debt, found it had little effect on people’s credit scores and mental health

Medical debt is the most common form of debt in collections in the US. But forgiving that debt once it has gone to collections may provide fewer health and financial benefits than once hoped.

A new study by researchers who partnered with RIP Medical Debt, a non-profit that buys and forgives medical debt, found “disappointing” results when people’s bills were purchased and forgiven, with little impact on people’s credit scores and willingness to go to the doctor.

“Our hope was that this would be a cost effective intervention,” said Raymond Kluender, lead author on the National Bureau of Economic Research (NBER) report which partnered with RIP Medical Debt, and an assistant professor of business administration at Harvard Business School.

“We find no real benefits on people’s household finances or their mental health or utilization of healthcare in our study,” Kluender said.

However, he added, he doesn’t “think any of the authors on the project would not say medical debt is not a huge issue”. Instead, Kluender said, “Our interpretation is you have to intervene upstream,” which essentially means it might be more effective to provide people with financial assistance or universal, affordable healthcare – the sort that might prevent bills from accumulating – rather than forgive one bill at a time.