NEW: NY’s Non-Profit Hospitals Withhold Patient Wages at an Alarming Rate

Posted August, 4 2022 by Amanda Dunker

New York’s non-profit hospitals can seize up to 10% of a patients’ wages to collect medical debt, an aggressive tactic that puts the health and well-being of low-income New Yorkers at risk. 

The Community Service Society of NY’s latest research reveals that five of New York’s nonprofit hospitals garnished the wages of 2,216 patients – between 6% and 46% of lawsuit cases – over unpaid medical bills. 

Disproportionately, these folks work low-wage jobs in health care and social services, manufacturing, and retail. This is consistent with national research that indicates medical debt disproportionately impacts people with low incomes and people of color, deepening long-standing inequities.

Meanwhile, the hospitals CSS investigated reported providing only $6 million in financial assistance despite receiving $19 million in state funding meant to cover the costs of patients who can’t afford their care. Non-profit hospitals are required to evaluate patients for financial assistance before garnishing wages, but past CSS research suggests this does not always take place.

Ten states already prohibit the placement of liens on debtors’ primary residences and four states prohibit wage garnishments. Now it’s our turn. A bill recently passed in the New York State legislature (S6522A/A7363A) would ban hospitals from garnishing patients’ wages or imposing liens on their primary residence. The bill awaits Governor Hochul’s signature, and we urge her to sign it immediately.