On May 16, Vermont Governor Phil Scott signed into law S. 27, a medical debt relief measure that prohibits the inclusion of medical debt on consumer credit reports and establishes a state-funded initiative to abolish qualifying medical debt held by Vermont residents.
Under the new law, scheduled to take effect on July 1, 2025, the State Treasurer is authorized to contract with a nonprofit entity to purchases and eliminate medical debts owed by Vermont residents. The legislation appropriates $1 million in FY2026 to support this effort. In addition to abolishing the debts, the contracted nonprofit must coordinate with credit reporting agencies to remove adverse credit information associated with the debt and provide written notice to…
