Prohibits state-operated hospitals from suing patients for medical debt

• Democratic27
• Republican1

◆ The sponsor's argument

Why Gustavo Rivera says this is needed

This bill would protect New Yorkers who receive care from New York State-operated hospitals from medical debt lawsuits. There are five State-operated hospitals: SUNY Upstate (Syracuse), SUNY Downstate (Brooklyn), SUNY Stony Brook (Long Island), Roswell Park (Buffalo) and Helen Hayes (Rockland County). Together, they sue their patients at disproportionate rates compared to other New York hospitals, suing over 3,000 patients per year. These lawsuits are pursued in State Supreme Court by lawyers from the Attorney General's office. An analysis of SUNY Upstate by the Community Service Society found that over 50 percent of the cases were filed in zip codes where residents are disproportionately people of color. They also found that 77% of patients who were sued live in zip codes where the median income is under $70,000 a year and thus were likely eligible for hospital financial assistance under state law. Another dozen patients who were sued lived in prison, and thus were unlikely to have any significant income at all. A July 2023 study by the Urban Institute indicates that 740,000 New Yorkers are afflicted by medical debt and that it is disproportionately shouldered by people of color, low-income people, and people who live in rural parts of New York State. This report noted that areas where the percentage of New Yorkers with medical debt are high coincide with areas where there are hospital medical debt litigation hotspots. Medical bill- ing is both confusing and difficult to navigate. Pricing is opaque and insurance payments are bewildering. New York State operated hospitals receive over $500 million annually in federal and state disproportionate share hospital (DSH) funding. They also benefit from local, state, and federal tax exemptions. Private and voluntary hospitals in New York receive only a portion of the DSH fund- ing for which they could be eligible because the need in New York is greater than New York's DSH funding cap. By contrast, these five State- operated hospitals receive the full amount of funding for which they are eligible, with the State paying the entire non-federal share of the DSH funding. Unlike these State-run hospitals, locally operated government- run public hospitals are only able to receive the full amount of DSH funding when their localities pay a portion of the non-federal share. Moreover, the largest government-run public hospital system in New York State, New York City Health and Hospitals, does not sue any patients at all. Suing patients is expensive and does little to offset the State-run hospitals' margins. For example, the total amount SUNY Upstate sued patients for in one year was just $16 million. SUNY Upstate's annual operating budget was $1.5 billion, indicating its practice of suing its patients will do little to ameliorate its bottom line. This bill would prohibit State-run hospitals from suing patients for medical debt and prevent them from perpetuating medical debt collection tactics that place an obscene burden on low-income New Yorkers who seek necessary medical care.

This is the sponsor's own case for the bill, quoted from their memorandum. It is not Agora's description of what the bill does.