This Debt Won't Appear On New Yorkers Credit Reports Anymore

Governor Kathy Hochul recently signed a bill into law that makes certain types of debt disappear from New Yorkers' credit reports. The bill (A06275A / S04907-A) passed in the Assembly on Tuesday, June 20, 2023, by a vote of 107 to 37. The Senate version already passed by a vote of 48 to 10.

Legislation S.4907A/A.6275A stops hospitals, health care professionals and ambulances in New York State from reporting medical debt to credit agencies.

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New York Now Prohibits Medical Debt From Impacting Credit

The law prevents medical debt from being reported to credit agencies in New York,

Prohibits medical debt from being collected by a consumer reporting agency or included in a consumer report and prohibits medical service providers from reporting medical debt directly or indirectly to a consumer reporting agency.

The Democrat & Chronicle reports that a New York Health Foundation study found that more than 740,000 residents around New York State have medical debt that has been reported to a debt collection agency and their credit reports.

No one should have to jump through hoops to protect their finances and today we’re taking steps to help New Yorkers on their journeys toward financial freedom.” ~ Governor Hochul

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Medical debt can affect a person's ability to purchase a vehicle, rent or buy a house, get a credit card, and potentially even a job. Community Service Society says that 38% of New Yorkers avoided care or sacrificed other necessities because of the cost of health care.

Nationally, 28% of Black people and 22% of Hispanic/Latinos carry medical debt versus 17% of whites, New York-based advocacy group Community Service Society reported.

The new law, which went into effect immediately, does not apply to medical debt paid with credit cards or medical debt incurred out of state.

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