New Jerseyans Get $86 Million in Medical Debt Relief

New Jersey Governor Phil Murphy announced that more than 53,000 residents will see a combined $86 million in medical bills abolished as a result of the state’s ongoing partnership with national nonprofit Undue Medical Debt.

This marks the state’s sixth round of medical debt relief. To date, this partnership with Undue Medical Debt has seen nearly $1.4 billion in medical debt eliminated for more than 828,000 New Jersey residents, according to the Murphy administration.

Undue Medical Debt purchased the latest debt relief from providers by leveraging approximately $600,000 in American Rescue Plan funds.

“Nobody should have to delay life-saving care because they fear the crushing burden of medical debt or cut corners to ensure their basic health care needs are met,” said Murphy.

Murphy said the state has also advanced policies to safeguard New Jerseyans from falling into medical debt, including the prohibition of credit reporting for most medical debts and caps on out-of-pocket costs for insulin and asthma inhalers; reforms promoting transparency in the pharmaceutical supply chain; and oversight of pharmaceutical benefits management companies.

There is no application process for medical debt relief. Undue Medical Debt purchases large, bundled portfolios of past-due medical debt belonging to those least able to pay for pennies or less on the dollar. Instead of trying to collect, Undue erases the debt.

Those who qualify for medical debt relief are either at or below 400% of the federal poverty line or have medical debts that equal 5% or more of their annual income. These are the only criteria for relief. This is a one-time abolishment to help remove the burden.

Medical debt relief cannot be requested. It depends on providers like hospitals and secondary market partners like collection agencies to sell their qualifying medical debt.

Those benefiting from medical debt relief will receive an Undue Medical Debt letter in the mail.