I am still pinching myself from the first gift we received from MacKenzie Scott in December of 2020 — and somehow Undue Medical Debt (formerly RIP Medical Debt) has now received three. What these gifts presented to us was an unprecedented opportunity to approach our work brazenly and with room for error, an opportunity rarely afforded to nonprofits picking up the pieces of broken social and economic systems.
These funds have greatly expanded our operational capacity, meaning we have room to take risks, think innovatively, focus on scaling, make investments in our long-term sustainability, and perhaps most importantly, position ourselves to push for policy changes that will eventually (hopefully) make our work obsolete. Overnight we were positioned to play the long game, no longer having to focus on near-term survival. We could dream big and take bold swings at the medical debt crisis we were designed to clean up after.
Here’s what that shift looked like for us.
Scaling Beyond the Big Gifts
First, we could scale. When we received the first gift at the tail end of 2020, we had abolished less than $2 billion of burdensome medical debt for families across the country. By the close of 2024, we grew that number to nearly $15 billion! And our most recent Scott gift, in December of 2024, is allowing us to soon close our biggest medical debt relief deal to date! It’s premature to share details just yet, but there’s an exciting announcement forthcoming.
You would be mistaken to think we used MacKenzie Scott funds alone to support these purchases. Instead, we used the funds to fuel our growth and long-term health. As CEP has shown with its research into the Scott grants, nearly 60 percent of nonprofit leaders share they are planning to spend down the grant over two to five years. While we applied some of the funds to these debt relief efforts, we also invested in strategies that would allow us to maintain scale over time.
This meant investing in new debt acquisition and fundraising efforts, having the privilege to test different approaches. Some fell short while others succeeded, but all provided valuable lessons and insights, all the while knowing that failure would not mean falling. These lessons allowed us to refine our model (updating our criteria for relief from 200 percent to 400 percent of the federal poverty level to help more families), giving us the ability to scale rapidly while not needing to rely only on the Scott grants for our debt relief ambitions.
We also focused money and attention on our debt processing software to ensure it could handle our growth as we scaled medical debt relief to new heights and we built new functionalities on the backend, designed to reduce manual effort, ensuring long term savings. We invested in our brand and adopted marketing strategies designed to support fund development and engagement with our constituents. And finally, we built a strong team by paying them competitively and enshrining a workplace culture that values competency, teamwork, and emotional intelligence.
From Scaling Solutions to Getting at the Roots of the Problem
But we didn’t want to just scale our core work; our dream extends beyond medical debt relief, recognizing that we have a lot to say about the origins and impacts of this crisis. Like other nonprofits focused on helping people, we have a unique appreciation for the lived experiences of our constituents. With these funds, we continue to effectively leverage our knowledge toward a deeper, collective understanding of the causes and effects of medical debt, in service of practical solutions that put patients first. Ideally, we will ultimately put ourselves out of business.
With this goal in mind we’ve developed a policy and program department with a focus on patient storytelling, research, community collaboration, and policy expertise, that allows us to drive attention to the issue of medical debt and demonstrate the impact it is having on families while highlighting the ways our healthcare financing system is failing us.
Policy efforts pair naturally with our debt relief intervention, allowing us to help people burdened today while also working to stymie the creation of new, unpayable medical debts. Direct intervention nonprofits are actively engaged in the fight for change, but too many are stunted by funding limitations. “Advocacy” dollars are far and few between and often come with limits or worse, are accompanied by dictated strategies.
At Undue, we are free to shape our policy strategies and our agenda is rooted in patients’ voices and experiences with healthcare – and we can put real funds behind raising awareness about medical debt writ large. These efforts seem to be paying off: Over the last few years, we’ve seen a flurry of policy changes introduced and passed to address medical debt at the federal and especially state level. A few examples include:
- At the urging of the Consumer Financial Protection Bureau, the three main credit reporting agencies have already banned medical debts under $500 from appearing on credit reports (a ruling to ban all medical debts is in legal jeopardy and faces an uncertain future under the new administration).
- Nine states have already followed suit and passed full medical debt credit reporting bans (California, Minnesota, Rhode Island, Connecticut, New York, Illinois, New Jersey, Virginia and Colorado) — in some cases with unanimous, bipartisan approval.
- Additional medical debt legislation across the country advances proposals to require screenings for financial assistance and capping medical debt interest rates, among others.
Scott’s generosity and unique approach have had transformative effects, enabling nonprofits to amplify their impacts and broaden their reach —CEP’s report provides ample evidence of this. Her gifts serve as a powerful endorsement, creating a kind of gravitational pull for other funders as well as increasing visibility, especially for those nonprofits which are tackling less appreciated social issues.
What I take away from this experience is the value of trust-based philanthropic giving of the kind that allows nonprofits room to fail. Absent that margin, strong leaders are forced to focus on survival, muting their ability to dream big, take the risks needed to innovate, and be effective advocates for change. We know nonprofits can manage deficits incredibly well, it only stands to reason that they can manage a surplus even better. More funders should be giving them that opportunity.
Allison Sesso is the president and CEO of Undue Medical Debt.
