NYC Mayor Eric Adams called the one-time program life changing.
Kevin C. Downs for NY Post
New York City officials and a nonprofit are teaming up to wipe out $2 billion in medical debt hanging over the heads of 500,000 New Yorkers as part of a “life-changing” initiative, the mayor’s office announced Monday.
The debt relief program would help city residents who have medical debt that is 5% or more of their annual household income as well as those with an annual household income that is 400% or lower of the federal poverty line, officials with Adams office and the city’s health department said.
The city will invest $18 million in the next three years while working with New York-based nonprofit RIP Medical Debt to wipe the slate clean for the hundreds of thousands of locals selected for the one-time program.
Mayor Eric Adams said the $2 billion program would be the largest municipal initiative of its kind in the country.
“Getting health care shouldn’t be a burden that weighs on New Yorkers and their families,” Adams said in a statement.
“Since day one, our administration has been driven by the clear mission of supporting working-class New Yorkers and today’s investment that will provide $2 billion in medical debt relief is another major step in delivering on that vision.
“Up to half a million New Yorkers will see their medical debt wiped thanks to this life-changing program — the largest municipal initiative of its kind in the country. We are proud to bring this relief to families across the five boroughs, as we continue to fight on behalf of working-class New Yorkers.”
RIP Medical Debt would buy bundled medical debt portfolios from providers, including hospitals and commercial debt buyers, and then eliminate the debt at pennies on the dollar, the mayor’s office said.
Recipients of the program will be alerted their financial burden is lifted with no caveats to fret over. There is no application process, the city stressed.
The program is supposed to get started in early 2024 and run for three years.
Medical debt has become the top cause of personal bankruptcy in the US. More than 100 million Americans face varying degrees of medical debt totaling about $195 billion, according to a 2022 Kaiser Family Foundation report.