Fact Check: Can Joe Biden Eliminate All Healthcare Debt By Executive Order?

In his first weeks in office, President Joe Biden continues to sign a modern-record number of executive orders.

He has put forth measures to address equality, climate change and the burdens of the COVID-19 pandemic.

The Claim

On Twitter, some people were critical of Biden's healthcare plan. User @DoctorFishBones wanted the plan to include medical debt elimination for all Americans, claiming it can be done through executive order.

You know what isn't in Biden's healthcare plans? Forgiving everyone's medical debt, which he could do with the stroke of a pen by executive order

— Meme Stock Consultant (@DoctorFishbones) January 29, 2021

The Facts

Debt elimination is a hot topic among lawmakers. The onset of a global pandemic has exacerbated the growing stress of medical bill debt in the country, as many people lost their jobs and their employer-based health insurance.

A study published in Health Affairs in 2018 found that one in six Americans has past-due healthcare bills on their credit report, a debt totaling $81 billion. A study from the Federal Reserve Bank of New York in June 2020 found that 35 percent of stimulus checks were used to pay off debts.

During his campaign, Biden adopted a proposal, Fixing Our Bankruptcy System to Give People a Second Chance, by Senator Elizabeth Warren (D-Mass.). The plan would "make it easier for people being crushed by debt to obtain relief through bankruptcy" and "close loopholes that allow the wealthy and corporate creditors to abuse the bankruptcy system at the expense of everyone else."

According to CNBC, a study from academic researchers found that more than 65 percent of all bankruptcies were tied to medical issues and an estimated 530,000 families turn to bankruptcy each year because of medical issues.

Senator Chuck Schumer (D-N.Y.) said in November that Biden could use an executive order to forgive the first $50,000 in federal student debt for every borrower with federal student loans. According to the New York Times, Biden remains skeptical of using executive authority for debt forgiveness.

Biden signed an executive order in January to direct the Department of Education to extend the payment pause for federal student loan borrowers until at least October 2021. The question remains if an executive order is possible to eliminate medical debt.

Jenifer Bosco, a staff attorney for the National Consumer Law Center (NCLC), told the Nation that canceling the medical debt would require some ingenuity because it is held by innumerable hospitals, private healthcare providers and debt collectors, which is a reflection "of our patchwork system."

Bosco said the solution lies in single-payer, universal health care and passing legislation so that past-due medical bills don't negatively affect people's credit scores.

Senator Bernie Sanders (I-Vt.) outlined a plan to eliminate medical debt on his 2020 presidential campaign website. He did not mention executive orders but said he would carry out his plan through negotiations with credit agencies to have the federal government purchase and extinguish medical debt, reform existing legislation and debt collecting practices and create a secure public credit registry to replace for-profit credit reporting agencies.

The NCLC said executive action is not sufficient to remedy the issue of medical debt affecting millions of Americans.

"President Biden definitely can't eliminate all medical debt through executive order because a lot of medical debt is held by private parties like medical providers or debt buyers," said Chi Chi Wu, an attorney for the NCLC.

"But he may be able to cancel debt owed to the federal government, such as civilian and servicemember debts owed to military hospitals or other federal health care providers."

In January, Biden announced that he will ask the Department of Veteran Affairs to delay collecting debts from veterans. According to the White House, an economic relief executive order "will help approximately 2 million veterans maintain their financial footing by asking the U.S. Department of Veterans Affairs to consider pausing federal collections on overpayments and debts."

The Ruling

Mostly False.

Biden could issue an executive order to cancel medical debt that the federal government holds, including debt owed to military hospitals or other federal healthcare providers, but an executive order would not be able to tackle private medical debt.

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U.S. President Joe Biden speaks before signing executive orders on healthcare in the Oval Office of the White House in Washington, D.C., on January 28, 2021. The orders included reopening enrollment in the federal Affordable Care Act. Mandel Ngan/Getty