Private Lenders Could Buy Dental Debt
The Illinois Senate unanimously passed legislation today intended to help dentists who’ve been affected by the budget stalemate. Many dentists who treat state employees have not been getting paid for their work. They’re part of a long list of businesses and institutions waiting to be reimbursed for work they’ve already done.
The proposal would allow dentists to sell their state IOUs. The lenders would then get to pocket the interest when the state finally makes good. Democratic Senator Scott Bennett says it doesn’t add any burden to taxpayers.
“They would basically give pennies on the dollar, often 90 cents or more on the dollar to vendors that are owed money from the state. But then when the state finally gets its act together and sends out payments, it then goes to the lender, who gets the full price and sometimes interest.”
But that interest is essentially paid for by taxpayers. Bennett says the legislation does not intend to prioritize dentists over other groups struggling without a state budget. He says once a budget is passed, this problem would go away.