VT S0027

$1,000,000 appropriated from the General Fund in fiscal year 2026 for the State Treasurer to contract with a nonprofit to purchase and abolish medical debt for eligible Vermont residents at no cost or tax consequence to debtors

Eligible debtors must be Vermont residents with household income at or below 400% of the federal poverty level, or who owe medical debt totaling 5% or more of household income

Credit reporting agencies prohibited from reporting or maintaining medical debt information in consumer files

Large health care facilities and medical debt collectors prohibited from reporting medical debt to credit agencies, and facilities may only sell medical debt to 501(c)(3) organizations for the purpose of debt cancellation

Effective date: July 1, 2025 (signed by Governor May 15, 2025)