NY Bans Medical Debt Judgment Liens and Wage Garnishments

NY Bans Medical Debt Judgment Liens and Wage Garnishments

By: Robert J. Nahoum

On November 23, 2022, New York Gov. Kathy Hochul signed legislation banning and wage garnishments and home judgment liens in medical-debt collection cases.

No one should face the threat of losing their home or falling into further debt after seeking medical care, Governor Hochul said. “I’m proud to sign legislation today that will end this harmful and predatory collection practice to help protect New Yorkers from these unfair penalties. With medical debt a burden for far too many, this is an important step to address this crucial issue.

The new law which takes effect immediately, amends New York Civil Practice Laws and Rules (CPLR) prohibiting home liens on an individual’s primary residence or garnishing wages to collect on medical debt.

State Senator Gustavo Rivera said, New Yorkers should not fear losing their homes or livelihoods as a result of seeking medical care, especially during such challenging financial times. I want to thank Governor Hochul for signing my bill into law to protect New Yorkers from facing liens on their homes or wage garnishment by medical institutions in their effort to collect medical debt. We must work together to eradicate medical debt from our State and I am thrilled that we are taking this important first step.

Assemblymember Richard Gottfried said, New Yorkers struggle with health care costs even when they have insurance.  People seeking care end up with bills to cover ever-increasing out-of-pocket costs, including high deductibles, copays and the various fees insurance doesn’t cover. People’s homes and income should not be threatened to satisfy medical debt. I thank Governor Hochul for signing S.6522A/A.7363A into law to help protect patients from these egregious practices.

In New York, one of the most effective ways for a debt collector to collect on a judgment is to garnishee your wages.  While the debt collector can only recover 10% of your wages, he hopes that he can shame and embarrass you into paying more before your employer finds out.

Judgment liens in New York encumber real estate owned by a judgment debtor in any county where the judgment creditor records the lien or where the court first enters the judgment. The judgment lien must be satisfied out of a sale of the judgment debtor’s home.

If you need help settling or defending a debt collection lawsuit, stopping harassing debt collectors or suing a debt collector, contact us today to see what we can do for you.

The Law Offices of Robert J. Nahoum, P.C
(845) 232-0202

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