A Win to Protect New Yorkers From Medical Debt

Today, Governor Hochul signed into law an important new policy that will protect New Yorkers from the harms caused by medical debt. New York became only the second state in the nation, after Colorado, to prohibit agencies from including medical debt of any amount on credit reports. We applaud Governor Hochul and the legislative leaders for taking this important step to shield New Yorkers from facing financial ruin simply because they got sick.

New York State has been a national leader with policies that protect consumers from unfair practices related to medical debt. Consumer protections secured in recent years include reducing the statute of limitations for medical debt lawsuits; lowering maximum interest rates on consumer debt; prohibiting liens and wage garnishment as means of medical debt collection; banning hospital facility fees for preventive care and requiring advance notice to consumers for instances in which fees will be charged; requiring hospitals to use a uniform application to make it easier for patients to apply for financial assistance for medical bills; and closing a loophole in the State’s surprise billing law to cover emergency services.

Over the years, many of our grantees and partners have been effective forces for progress: Community Service Society of New York’s patient storytelling initiative and medical debt lawsuit research; the Volunteer Lawyers Project of Central New York’s direct legal assistance and education; the End Medical Debt in New York organizing campaign spearheaded by the Public Policy and Education Fund of New York; and the Health Care for All New York Coalition’s advocacy for consumer protections. And the Urban Institute has conducted seminal analyses of medical debt in New York State.

The Foundation has written about medical debt and provided testimony calling attention to how New York’s courts could further protect consumers in this area.

More work lies ahead: New York needs to implement existing policies well (like making it easy and uniform for patients to apply for financial assistance) and do more to protect consumers, including expanding financial assistance, expanding health insurance coverage, and lowering cost-sharing. Medical debt is sometimes called “a uniquely American injustice” and that continues to be true. But today, New York is one step closer to correcting that injustice. It’s an achievement worth celebrating.

Forward together!

David Sandman, Ph.D.
President & CEO
New York Health Foundation