Gov. Phil Murphy announced Wednesday that the state, in partnership with national nonprofit Undue Medical Debt, delivers a fifth round of medical debt relief, erasing more than $59 million owed by over 48,000 New Jersey residents.
The Murphy administration used about $500,000 in American Rescue Plan funds to purchase and erase qualifying debt from hospitals, providers, and the secondary market, including collection agencies and debt buyers. Officials said residents will receive letters in the mail in the coming days notifying them of the debt relief.
“Far too many New Jersey families have felt the crushing burden of medical debt, often following necessary or life-saving medical care,” Murphy said. “By partnering with Undue Medical Debt and implementing forward-thinking policies to prevent our residents from falling into debt, we are providing tangible relief to New Jersey families.”
Acting Health Commissioner Jeff Brown called the announcement “another critical milestone” in the state’s efforts to make health care affordable and accessible.
“With each round of debt relief, we are reinforcing our commitment that health care is a right, not a privilege reserved for those who can afford it,” Brown said.
New Jersey became one of the first states to both prohibit medical debt reporting to credit agencies and dedicate funding to directly abolish residents’ medical debt. Through its partnership with Undue Medical Debt, the state has now erased more than $1.3 billion in medical debt.
The program does not require applications. Residents qualify automatically if they earn at or below 400 percent of the federal poverty line or if their medical debt equals 5 percent or more of their annual income. Undue Medical Debt identifies and purchases qualifying accounts directly from hospitals, providers, or collection agencies, then erases the debt. Residents who benefit will receive a branded letter in the mail.
Undue Medical Debt President and CEO Allison Sesso praised New Jersey’s ongoing efforts to reduce financial strain on residents.
“This fifth round of relief demonstrates New Jersey’s unwavering commitment to protecting families from the financial and emotional burden of medical debt,” Sesso said. “No one chooses to get sick, be in an accident, or have a chronic illness. We’re thrilled that tens of thousands more people will soon receive this good news in the mail.”
Murphy’s initiative also strengthens consumer protections and lowers health care costs, including caps on out-of-pocket expenses for insulin and asthma inhalers, as well as new transparency measures for pharmaceutical benefit managers.
