New York City Plans to Wipe Out $2 Billion in Medical Debt for 500,000 Residents

By Hamodia Staff

New York City Mayor Eric Adams announced Monday, January 22, a medical debt relief program that will invest $18 million over three years to relieve over $2 billion in medical debt for hundreds of thousands of working-class New Yorkers.

RIP Medical Debt, a non-profit which purchases medical debt in bulk from hospitals and medical facilities at pennies on the dollar and forgives the debtors, will purchase bundled medical debt portfolios. Recipients owe nothing on the debt and face no tax penalty.

The city’s program would wipe out debt for up to 500,000 New Yorkers on a one-time basis. The one-time debt relief program, the largest municipal initiative of its kind in the country, will launch in early 2024 and run for three years. To supplement the city’s investment, RIP Medical Debt and the Mayor’s Fund to Advance New York City will also partner to raise additional funding over three years.

The debt relief will be available for people whose annual household income is at or below 400 percent of the Federal Poverty Line, or if their medical debt equals 5 percent or more of their annual household income.

“Getting health care shouldn’t be a burden that weighs on New Yorkers and their families,” said Mayor Adams. “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.

“No one chooses to go into medical debt — if you’re sick or injured, you need to seek care. But no New Yorker should have to choose between paying rent or for other essentials and paying off their medical debt, which is why 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.”