NEW YORK STATE ASSEMBLY MEMORANDUM IN SUPPORT OF LEGISLATION submitted in accordance with Assembly Rule III, Sec 1(f)
 
BILL NUMBER: A1538A
SPONSOR: Gottfried
 
TITLE OF BILL:
An act to amend the civil practice law and rules, in relation to the
rate of interest on a judgment for medical debt
 
PURPOSE:
To require the interest rate on medical debt to be the lesser of the
one-year United States treasury bill rate or three per centum per annum.
 
SUMMARY OF PROVISIONS:
Section one of the bill amends Section 5004 of the civil practice law
and rules to require the interest rate on medical debt to be the lesser
of the one-year United States treasury bill rate or three per centum per
annum, defines "medical debt" and "one-year United State treasury bill
interest rate" and requires the Office of Court Administration to calcu-
late and publicize the rate on its website.
Section two of the bill is the effective date.
 
JUSTIFICATION:
Medical debt is a massive problem for many New Yorkers, especially for
those who are facing extreme financial hardship. Changing the rate of
interest on medical debt to a fairer rate will provide some measure of
relief to those struggling to pay for the health care they need and
deserve for themselves and their families.
 
LEGISLATIVE HISTORY:
2020: A10814 - referred to Codes Committee
 
FISCAL IMPLICATIONS FOR STATE AND LOCAL GOVERNMENTS:
None.
 
EFFECTIVE DATE:
Immediately.
STATE OF NEW YORK
________________________________________________________________________
1538--A
2021-2022 Regular Sessions
IN ASSEMBLY
January 11, 2021
___________
Introduced by M. of A. GOTTFRIED, McDONALD -- read once and referred to
the Committee on Codes -- committee discharged, bill amended, ordered
reprinted as amended and recommitted to said committee
AN ACT to amend the civil practice law and rules, in relation to the
rate of interest on a judgment for medical debt
The People of the State of New York, represented in Senate and Assem-bly, do enact as follows:
1 Section 1. Section 5004 of the civil practice law and rules, as
2 amended by chapter 258 of the laws of 1981, is amended to read as
3 follows:
4 § 5004. Rate of interest. (a) Interest shall be at the rate of nine
5 per centum per annum, except where otherwise provided by statute,
6 provided that the annual rate of interest to be paid on a judgment or
7 accrued claim in an action arising out of a medical debt shall be the
8 lesser of the one-year United States treasury bill rate or three per
9 centum per annum.
10 (b) For the purposes of this section the following terms shall have
11 the following meanings:
12 1. "Medical debt" means any obligation or alleged obligation of any
13 natural person to pay money arising out of medical care provided to that
14 person by a hospital licensed under article twenty-eight of the public
15 health law or a health care professional authorized under title eight of
16 the education law.
17 2. "One-year United States treasury bill rate" means the weekly aver-
18 age one-year constant maturity treasury yield, as published by the board
19 of governors of the federal reserve system, for the first full calendar
20 week of the calendar month preceding the date in which the judgment
21 awarding damages is entered.
22 (c) The one-year United States treasury bill rate shall be calculated
23 by the office of court administration. The office of court adminis-
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[] is old law to be omitted.
LBD00594-03-1
A. 1538--A 2
1 tration shall publish the rate for permanent public access on such
2 office's website on or before the first business day of each month.
3 § 2. This act shall take effect on the forty-fifth day after it shall
4 have become a law and shall apply to all judgments entered on or after
5 such date.