New Yorkers struggle with health care costs, even when they have insurance. Over 50,000 New York patients have been sued for medical debt by non-profit hospitals in the past five years—over 5,000 during the COVID-19 pandemic (March – December 2020). Check out the Community Service Society of New York’s Discharged Into Debt: A Pandemic Update report here to learn more. To add insult to injury, non-profit hospitals often charge an additional 9 percent interest on top of their medical debt judgments, adding hundreds if not thousands of dollars to their bills. This is allowed under section 5004 of the New York Civil Laws and Practice Rules—which makes no distinction about the type of entity that is suing or what the person is being sued for.
Patients often cannot determine when they need health care and how they get it. And they are paying the price. For example, on January 5, 2021, the New York Times profiled Scott Buckley, a 48 year-old Stop & Shop employee, who was sued for $21,028 in medical bills. He then received a judgment that included another $4,000 in interest and fees—at the statutory 9 percent interest rate. As Mr. Buckley put it, “I am literally broke…I don’t have a penny to my name. I have three kids. If they take my paycheck, I won’t have anything.”
Enough is enough. New York’s hospitals benefit from their non-profit status and should behave like charities, not loan sharks. Luckily, now there is a bill that will address these outrageous practices, S3057A/A1538A. This bill would ensure that a reasonable U.S. Treasury rate—currently around 1 percent—would be imposed in medical debt collection cases instead of the allowable 9 percent, and it would cap interest at no more than 3% if that rate goes up precipitously.
HCFANY would like to thank Assemblymember Richard Gottfried and Senator Gustavo Rivera for introducing this important piece of legislature. Join us and our partners in supporting this bill! 27 different patient advocacy groups—Citizen Action of New York, African Services Committee, The Actors Fund, and many more across New York State—have written memos of support for the passage of this bill.
S3057A is calendared to be voted on in the Senate Judiciary Committee on Tuesday, 5/11/21. Please take action and tell our members of the Senate Judiciary Committee to pass this bill. Need a list of who is on the committee? We got you: Senator Jamaal T. Bailey, Senator Alessandra Biaggi, Senator Phil Boyle, Senator Neil Breslin, Senator Andrew Gounardes, Senator Brad Hoylman, Senator Anna Kaplan, Senator Andrew Lanza, Senator Zellnor Myrie, Senator Thomas O’Mara, Senator Peter Oberacker, Senator Anthony Palumbo, Senator James Skoufis, Senator Toby Ann Stavisky, and Senator Kevin Thomas.