New Jersey residents facing medical debt now have enhanced protections under the Louisa Carman Medical Debt Relief Act, marking its one-year anniversary. The law, effective since July 22, 2024, aims to shield New Jerseyans from aggressive debt collection practices and the negative impact of medical debt on credit scores.
Key provisions include capping interest rates at 3%, prohibiting wage garnishment for those earning up to 600% of the Federal Poverty Level, mandating reasonable payment plans between patients and providers, and requiring notifications about these rights in all collection communications.
Governor Phil Murphy emphasized the importance of these measures: “Over the course of my Administration, we have worked diligently to build a health care system that is more affordable and more accessible for families across New Jersey... I am immensely proud to mark this milestone and honor Louisa’s mission for change.”
The NJ for Health Care Coalition, NJ Appleseed Public Interest Law Center, and New Jersey Citizen Action have launched EndMedDebtNJ.org. This online resource hub provides information on managing medical debt disputes, insurance appeals, and payment negotiations. It has already assisted nearly 1,000 visitors since its soft launch.
Laura Waddell from New Jersey Citizen Action highlighted the significance of these reforms: “We applaud Governor Murphy’s strong and comprehensive commitment to tackling the crisis of medical debt in New Jersey... These reforms are not only urgently needed — they are deeply meaningful.”
Elizabeth M. Harris from the Division of Consumer Affairs remarked on consumer protection: “Thanks to the protections established under the Louisa Carman Medical Debt Relief Act, New Jerseyans no longer have to fear that crippling medical expenses will undermine their financial stability.”
Beverly Brown Ruggia noted federal rollbacks make state-level protections even more critical: “With a federal court striking down the Consumer Financial Protection Bureau’s rule on medical debt credit reporting last week... resources like this are more essential than ever.”
EndMedDebtNJ.org offers tools such as a downloadable manual and information on navigating complex medical costs and debts. Renee Steinhagen from NJ Appleseed stated it is a powerful new resource for understanding bills or responding to collection lawsuits.
Mary Pat Gallagher added that despite federal changes, state law still protects residents by voiding any reported debts if violated. Ralph J. Lamparello from the New Jersey State Bar Foundation expressed hope that these resources ease legal challenges during medical emergencies.
Quinton Law from the American Cancer Society Cancer Action Network praised Governor Murphy's initiative as a critical step towards easing financial burdens following diagnoses.
Colleen H., a Belleville resident who faced significant medical debt after an injury without insurance coverage said: "Knowing that there are now protections in place for people like me... has given me a real sense of relief."
