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Governor Phil Murphy of New Jersey announced a major initiative on Tuesday (August 20) that will eliminate some or all of the medical debt for thousands of eligible individuals and families across the state. The initiative, which is part of a broader effort to make health care more affordable and accessible, will leverage over $550,000 in American Rescue Plan funds. The state is partnering with the charity Undue Medical Debt to deliver relief to nearly 50,000 residents, erasing a total of $100 million in medical debt.
The beneficiaries of this initiative include 17,905 residents who owed $61.6 million to Prime Healthcare hospitals and an additional 31,748 residents owing more than $38.4 million to other providers through the secondary debt market, primarily collections agencies. Prime Healthcare partnered with Undue to sell qualifying, unpayable medical debts for relief.
Governor Murphy said, “Medical debt accumulates very quickly and can follow a person for decades. With this strategic investment and our partnership with Undue, we are wiping the slate clean for thousands of New Jersey families, eliminating their debt, and making a real, tangible impact on their lives.”
This announcement follows the signing of the Louisa Carman Medical Debt Relief Act, which safeguards New Jersey families from accumulating medical debt, protects against predatory medical debt collectors, and prohibits the reporting of medical debt to credit reporting agencies. New Jersey is one of only five states in the nation that both prohibits medical debt reporting to credit agencies and has allocated funding to provide residents with direct medical debt relief.