TRENTON, N.J — Governor Phil Murphy signed a bill Monday to provide new protections for residents struggling with medical debt.
The legislation, known as Louisa Carman Medical Debt Relief Act, is designed to ease financial burdens on patients, and prohibits hospitals and health care facilities from selling medical debt to collections agencies. It also mandates transparent billing practices and caps interest rates on unpaid medical bills.
In a statement, Murphy extended his enthusiasm for the bill: “The Louisa Carman Medical Debt Relief Act is a monumental step toward building a health care system that is more affordable and more accessible for families all across New Jersey. And it will always stand as a testament to the indispensable role Louisa played in transforming our health care system for the better, so we can protect all of our neighbors from being forced to choose between seeking potentially life-saving care or falling into a medical debt trap.”
Proud to sign the Louisa Carman Medical Debt Relief Act into law today, protecting New Jerseyans from falling into medical debt and facing the risk of financial ruin.
This legislation is a fitting tribute to Louisa and her work to ensure every family can access the health care… pic.twitter.com/fAvzhnfE7G
— Governor Phil Murphy (@GovMurphy) July 22, 2024
The bill received bipartisan support and aims to enhance patient financial protections. The new regulations take effect immediately.
What Is The Louisa Carman Medical Debt Relief Act?
The law includes several key provisions. It requires health care providers to offer patients clear, itemized bills and prohibits the use of aggressive collection tactics. Patients will also have the right to set up affordable payment plans. Additionally, the law establishes a standardized process for disputing medical charges.
Governor Murphy emphasized the importance of these measures in preventing financial ruin due to unexpected medical expenses. He noted that medical debt is a significant issue for many families, often leading to bankruptcy and long-term financial hardship.
Today, Louisa Carman Medical Debt Relief Act becomes law. Thank you @GovMurphy, @ASWReyJackson, @NJSenTurner for protecting NJ from the worst effects of medical debt. No one should have their credit ruined because they got sick or injured! pic.twitter.com/iTxwGUA2Gg
— New Jersey Citizen Action (@NJCitizenAction) July 22, 2024
“This legislation is a crucial step in ensuring that New Jersey residents are not forced to choose between their health and their financial stability,” Murphy said.
The bill also includes provisions for increased oversight and accountability of health care providers regarding their billing practices. This is intended to ensure compliance with the new regulations and provide additional protection for patients.
The law’s enactment follows growing concerns about the impact of medical debt on individuals and families across the state. Advocates for the bill argue that it will provide much-needed relief and help create a more transparent and fair health care system in New Jersey.
To read more about the bill, click here.
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