Evan Spiegel donation will cancel $550 million in California medical debt
The Snap co-founder and Miranda Kerr funded debt relief for more than 261,000 Californians through Undue Medical Debt.
By Daniel Okafor · Business Editor
3 min read
A donation from Snap co-founder Evan Spiegel and his wife, Miranda Kerr, will erase $550 million in unpaid medical bills for more than 261,000 Californians, the Los Angeles Times reported. The gift puts another major tech fortune behind a debt-relief model that buys old medical bills at discounted prices and cancels them.
According to the Los Angeles Times, Spiegel and Kerr made a multimillion-dollar donation this spring to Undue Medical Debt, a nonprofit that purchases uncollectible medical debt and forgives it. The size of the couple’s donation was not disclosed.
Undue Medical Debt said affected Californians will begin receiving letters in mid-July telling them their debt has been cleared. The nonprofit said people qualify automatically if they earn no more than 400% of the federal poverty level or if their medical debt is greater than 5% of their annual income.
San Diego County is expected to receive the largest amount of relief, with about $99 million in debt canceled for roughly 40,000 residents, according to the figures reported. Los Angeles County is set to see $26.7 million canceled for about 17,500 people.
How the debt relief works
Undue Medical Debt president and CEO Allison Sesso said in a statement that the gift would lift more than half a billion dollars in unpaid bills from more than a quarter-million families. Sesso said one in four U.S. adults has medical debt, which she described as a crisis affecting health care access, finances and mental health.
The nonprofit’s method depends on the market for distressed debt. Hospitals and medical groups sell debt they do not expect to collect, often in large bundles at reduced prices, according to Fortune’s account of the model. Undue Medical Debt buys those portfolios and cancels the bills rather than trying to collect from patients.
Fortune reported that the group says $10 in donations can erase about $1,000 in patient debt. That leverage allowed Spiegel and Kerr’s undisclosed gift to produce $550 million in canceled obligations.
MacKenzie Scott helped expand the model
MacKenzie Scott, the former wife of Amazon founder Jeff Bezos, helped bring the model to a larger scale through multiple gifts to the same nonprofit, according to Associated Press reporting cited by Fortune. Scott gave $50 million in 2020, $30 million in 2022 and another donation in December 2024, when the group was formerly known as RIP Medical Debt.
Undue Medical Debt says it has eliminated more than $40 billion in medical debt across all 50 states. Fortune also cited other examples, including a Jane and Daniel Och Family Foundation-backed effort that canceled $264 million for more than 125,000 Miami-Dade residents, New York City’s $18 million commitment to clear nearly $135 million for more than 75,000 residents, and Cook County, Illinois, using $9 million in federal ARPA funds toward $1 billion in relief.
Spiegel and Kerr have made other California-linked donations, Fortune reported. In 2022, they paid off more than $10 million in student loans for graduates of Otis College of Art and Design. After January 2025 wildfires destroyed Spiegel’s childhood home in Pacific Palisades, Spiegel, Snap and co-founder Bobby Murphy gave $5 million in immediate aid and pledged $10 million to start the Department of Angels recovery initiative.
Broader policy efforts have been less durable. Fortune reported that a Consumer Financial Protection Bureau rule that would have removed medical debt from credit reports for 15 million Americans was vacated on July 11, 2025, by U.S. District Judge Sean Jordan of the Eastern District of Texas, who found the agency exceeded its authority and violated the Fair Credit Reporting Act.
This story draws on original reporting from Fortune.