Attorney Tanya Hobson-Williams of Hobson-Williams, P.C. says she supports New York City Mayor Eric Adams’ plan to have a nonprofit work with hospitals and healthcare facilities to eliminate medical debt that is being carried by city residents in need.
The NYC Health Department recently entered into an agreement with RIP Medical Debt to have the not-for-profit debt relief firm work with hospitals to reduce the amount owed, then have the balance paid off through public funding and private donations. The company only buys pre-qualified debt. After negotiating with the hospital, RIP will pay the agreed upon amount, and patients will receive a letter stating that the debt has been paid off.
According to the Community Service Society (CSS), a New York-based nonprofit focused on combating poverty, more than 54,000 New Yorkers faced legal action against hospitals over unpaid bills between 2015 and 2020. CSS said those who were sued should have received financial help for their situations.
In 2020, during the pandemic lockdown, the state approved a bill changing the amount of time that hospitals are forbidden from collecting medical debt from seven to three years. On April 11, 2023, the three major credit reporting companies — TransUnion, Equifax and Experian — removed all medical collections under $500 from people’s credit reports and credit history. Any debt exceeding $500 can appear on one’s credit report for up to seven years.
“This plan would help a lot of low-income individuals and alleviate the stress of calls from hospitals and debt collection agencies,” Ms. Hobson-Williams says. “Mayor Adams’ initiative is a step in the right direction that will help those struggling to pay off their medical debt.”
