MAYOR ADAMS RELIEVES $80 MILLION IN MEDICAL DEBT FOR WORKING-CLASS NEW YORKERS

 

Pioneering Program Launched by Mayor Adams Relieves Medical Debt for 35,000 New Yorkers in Partnership with Undue Medical Debt 

  

New York City’s Investment Will Provide $2 Billion in Relief for up to 500,000 New Yorkers, Becoming Largest Municipal Medical Debt Relief Program in Nation 

New York City Mayor Eric Adams and New York City Department of Health and Mental Hygiene (DOHMH) Acting Commissioner Dr. Michelle Morse today announced that, beginning this week, 35,000 New Yorkers will start receiving letters notifying them that their medical debt has been eliminated by a pioneering program launched by Mayor Adams last year — clearing $80 million in debt. Medical debt — the number one cause of bankruptcy in the United States — disproportionately affects uninsured, under-insured, and low-income households, and the city’s investment of $18 million over three years will relieve a total of over $2 billion in medical debt for 500,000 working-class New Yorkers on a one-time basis.  

  

The city has partnered with Undue Medical Debt, a national New York City-based nonprofit specializing in buying and ultimately wiping out medical debt to acquire debt portfolios and retiree debt from health care providers and hospitals across New York City. There is no application process for New York City’s one-time debt relief program, which is the largest municipal initiative of its kind in the country. 

 

“Working-class families should not have to choose between paying medical bills and keeping a roof over their heads, and thanks to our administration, they won’t have to,” said Mayor Adams. “With this debt relief program, our administration is following through on its promise to relieve $2 billion in medical debt, starting with putting $80 million back in the pockets of working-class New Yorkers this week alone. Our administration is committed to making New York City more affordable and the best place to raise a family.”  

 

“In thousands of mailboxes this week, New Yorkers will find a letter from Mayor Adams and our partner, Undue Medical Debt, stating that their outstanding medical debt has been abolished,” said Deputy Mayor for Health and Human Services Anne Williams-Isom. “A total of 35,000 constituents will receive letters relieving $80 million in total debt. It is the first round of relief for a program set to touch roughly half a million New York City residents in the coming months and years. As we work toward structural change in our health care system to help people avoid debt in the first place, we are doing our part right now to help individuals and families thrive free from medical debt.” 

  

“Receiving life-saving medical care should not lead to financial stress, yet, countless New Yorkers have faced that reality for years,” said DOHMH Acting Commissioner Dr. Morse. “We are eager to get much needed debt relief to as many New Yorkers as possible, as soon as possible. We look forward to reaching our goal of 500,000 New Yorkers over the next three years so that those hardest hit by medical debt can instead focus on what matters most: their health and wellness.”   

  

Undue Medical Debt will purchase bundled medical debt portfolios from providers, like hospitals and commercial debt buyers, to then abolish that debt at pennies on the dollar. Debt relief recipients will then be notified that their debt has been bought by a third party and erased, with no strings attached. Recipients owe nothing on the debt and face no tax penalty. New Yorkers who fit one of the two eligibility criteria will qualify for the debt relief announced today if their debt has been acquired: 1) having annual household income at or below 400 percent of the Federal Poverty Line or 2) having medical debt equal to 5 percent or more of their annual household income. 

  

To supplement the city’s investment, Undue Medical Debt and the Mayor’s Fund to Advance New York City will also partner to raise additional funding over three years in order to relieve more medical debt. New Yorkers interested in helping relieve medical debt can donate online. 

  

More than 100 million Americans hold some medical debt, with the total amount nationwide exceeding $195 billion. Carrying medical debt can undermine financial stability and mobility, as it can affect credit scores and put individuals and families in difficult positions to choose between care and other necessary expenses. Black and Latino communities are 50 percent and 35 percent, respectively, more likely to hold medical debt than their White counterparts, and while medical debt may be held by those without insurance, even those with insurance are at risk of carrying medical debt.