NY governor signs Fair Medical Debt Reporting Act

A new bill titled the ‘Fair Medical Debt Reporting Act’ has been signed into law by the governor this week. Finance expert Jarrett Felton explains how this act affects New Yorkers.

This bill bans healthcare providers from reporting medical debt to credit agencies and the hope is that this may help New Yorkers’ financial health as they pay their medical bills. News 8 spoke with Jarrett Felton, the managing director of Invessent Wealth Management. He helps people understand their finances so they’re in control of their money.

Felton said, “I think the conversation shouldn’t be looked at and geared towards people that want to take advantage of a system. I think it’s more so for just the consumers in general. Like how do we make sure that we as a people from a humanitarian perspective can help make sure that people have a leg up and we can use this as a stepping stone to help them get to a better place in their life financially?”

Felton continued, “Don’t lose sight of the fact that the debts are still there. Before you try and go and live your best life, this will help you get there in the short term. Realize we still have to budget accordingly. We still have to understand that we still have to keep communication lines open with whom we have debts to. Especially the medical side of stuff, how we want to structure payments because if we’re going to acquire new debt, we have to tend to the debt that we already have accumulated.”

When medical debt is reported to credit bureaus, health care providers send the bill to a collection agency which can harm a person’s credit score. A credit score is a three-digit number between 300 and 850 which represents how attractive a borrower is to a lender. So, if someone wanted a car loan, they may need a higher credit score. Missed or late payments would negatively impact that score and in turn, affect a consumer’s borrowing power. New York is the second state to enact this law behind Colorado. RochesterFirst.com