AI Expands Role in Collecting US Medical Debt This Winter

More than one in four US adults reported owing a medical debt in 2025, and the share was identical among people with health insurance, according to an analysis by the Urban Institute and the Robert Wood Johnson Foundation reported by The Guardian. The finding lands as artificial intelligence moves deeper into the machinery that generates, bills and collects that debt — software that now takes notes in exam rooms, codes visits, drafts billing messages and runs chat agents inside patient portals.

How Many Americans Carry Medical Debt?

The one-in-four figure, drawn from the Urban Institute and Robert Wood Johnson Foundation report released last Tuesday, held steady regardless of insurance status, per The Guardian's reporting.

By the numbers:

• More than 25% of US adults reported owing medical debt in 2025.
• The proportion was the same — about one in four — among adults who had health insurance, the report found.

Those figures matter because they undercut the assumption that coverage alone insulates patients from collections. Insured patients are showing up in the debt pool at the same rate as the uninsured, according to the analysis.

Why Is Medical Debt Expected to Grow This Winter?

April Kuehnhoff, a senior attorney at the National Consumer Law Center, told The Guardian that debt will climb among "both the insured and uninsured, because of how we're increasingly putting more costs onto individuals for those plans." She pointed to people who lose coverage because they cannot afford it or cannot meet new eligibility requirements, as well as people who keep a plan but absorb a higher deductible or co-pay. "It's people who maybe they can afford it but the plan they get isn't as good, and they are asked to have a higher deductible, higher co-pay, so they just have a higher out-of-pocket [cost]," Kuehnhoff said.

The Guardian ties the coming increase to Republican-led health cuts set to take effect this winter, which are expected to push more costs directly onto patients.

How Is AI Changing Medical Billing and Collections?

The billing pipeline itself is being automated end to end, according to The Guardian's reporting. AI systems now listen in exam rooms and generate clinical notes, assign medical codes to visits, draft and send billing messages, and operate as agents that text patients inside billing portals. Each of those steps feeds the next: a coded visit becomes a bill, a bill becomes a collections case, and a collections case increasingly gets worked by software rather than a phone-bank employee.

Companies selling AI-backed coding and billing services are finding expanding markets as a direct result of the Republican-led health reforms, the Guardian reported, citing the broader shift of costs onto individual patients as a demand driver for automated billing tools.

What Do Consumer Advocates Say About AI-Driven Settlements?

Artificial intelligence is also being used by collectors to calculate personalized discounts offered in settlement negotiations, according to The Guardian. The outlet describes that practice as an analogue to the personalized pricing models that have drawn scrutiny from the Federal Trade Commission, though it did not report a specific FTC action against medical-debt pricing. The comparison signals a regulatory flashpoint: a tool that varies the settlement offer by patient, rather than applying a flat discount schedule, raises the same fairness questions regulators have raised about personalized consumer pricing elsewhere.

What Are Wall Street Analysts Saying About AI in Billing?

Financial analysts at JPMorgan have described AI's use in coding, billing and collections as "early wins," according to The Guardian. That framing sits alongside more sweeping predictions from AI company leaders — Anthropic chief executive Dario Amodei has said AI could help cure all diseases within a decade — claims The Guardian notes scientists view with skepticism. The contrast is notable: the furthest-out promises concern AI's clinical potential, while the nearest-term, already-monetized use case is administrative — coding a visit and chasing the resulting balance.

What Should Patients Watch For?

For patients, the practical shift is in who, or what, sends the bill and negotiates the balance. A text in a billing portal may come from an AI agent rather than a staffer, and a settlement offer may be the output of a personalized-discount algorithm rather than a fixed-percentage policy. Kuehnhoff's warning — that out-of-pocket costs are rising for insured and uninsured patients alike — suggests the volume moving through that automated pipeline is set to increase as the winter cuts take hold, according to The Guardian's reporting.

For the full account, including additional detail on coding and collections vendors, see The Guardian's original report.