Assemblyman Andrew Goodell is blasting a program included in the state budget that will ban hospitals from suing patients earning less than 400% of the federal poverty level. That means hospitals can’t sue to collect medical debt for four-person households earning $120,000 a year. The legislation also expands hospital financial assistance programs for low-income New Yorkers, limits the size of monthly payments and interest charged for medical debt, implements other protections to improve access to financial assistance, and mitigates the deleterious effects of medical debt on New Yorkers.
Goodell argued on the Assembly floor on Friday that the program is a hidden tax on state residents. Hospitals have a bad debt charity pool that is funded through a surcharge on Medicaid and Medicare payments as well as a surcharge on health insurance. “The cost of this program, which is currently about $1 billion, will just explode,” Goodell said before mentioning his pending retirement from the Assembly. “This is like a program for universal free health care at hospitals for those who are earning 27% or more of the median income in your community. In my community, by the way, you could earn double, double, the individual per capita (income) and get free hospitalization. My friends, this is an astronomically expensive proposal that should not be part of this budget, because you will be paying for it long after I leave.”
Assemblywoman Helene Weinstein said the hospital indigent program costs in the hundreds of millions of dollars in response to a question from Goodell. The legislation changes both how the indigent program can be used and how hospitals can collect that debt. The program is open to all, including those who are not New York state residents, though Weinstein did not know how much it would cost to provide hospital care for immigrants under the program.
Weinstein said in addition to the income limitations on hospital debt collection, the hospital debt has to be more than 10% of a person’s income before a bad debt collection lawsuit can be filed. To read more click here.