Transcript: Mayor Adams to Relieve Over $2 Billion in Medical Debt for Hundreds of Thousands of Working-Class New Yorkers

January 22, 2024 NYC Office of the Mayor News

Deputy Mayor Anne Williams-Isom, Health and Human Services: Hi, good morning, everybody. I'm Anne Williams-Isom, and I'm the deputy mayor for Health and Human Services. And we are here today to share another example of what Mayor Adams and this administration is fighting for for working people and families across the city.

I'll let the mayor get into the details of the announcement, but I'd like to acknowledge some people who are standing here with us today. Along with Mayor Adams we have the city's doctor, Dr. Ashwin Vasan. We have Vilda Vera Mayuga, commissioner of the Department of Worker and Consumer Protection; Allison Sesso, president and CEO of RIP Medical Debt.

Ann Kurth, president of New York Academy of Medicine. Drew Mehalek, who is going to give us some remarks this morning. My sister, Deputy Mayor, who, Ashwin, you're blocking 'cause she's very… [Laughter.] Get out the way, Ashwin. Stand on the other side, don't do that.

My Sister, Deputy Mayor Ana Almanzar. The Mayor's Fund Executive Director, Marcella Tillett. We have memories of HTC in the house. Yeah? HTC. And I think Shams DaBaron is on his way. And with that, I will turn the mic over to Mayor Adams.

Mayor Eric Adams: Good stuff. Good stuff. Really, really, really excited about this announcement today, because medical debt impacts so many New Yorkers. And the governor mentioned it in her State of the State address, and we know that this is something that we must have teamwork to really capture and focus on.

So, Deputy Mayor Williams-Isom, I want to really thank you and your team. And Dr. Vasan, commissioner of Department of Health and Mental Hygiene, he's going to be rolling out some really good stuff in the next couple of days that he has been focused on, but today we want to talk about a burden that is impacting not only a large number of New Yorkers, but Americans.

Medical debt is real. And you do not make a choice to deal with the medical debt, it is something that comes into your life without, in many cases being even expected that it is here. And every New Yorker knows firsthand the health system can be costly and put pressure on household budgets.

And then, you know, not only do you hold your breath when you go into a hospital or a doctor's office and wait for a diagnosis, you continue to hold your breath when you see the bill and what it costs, particularly for low income New Yorkers.

And we all know family, a family member, a friend, a colleague who has gone through some form of care, some form of surgery. All of us, if we were to take a moment and pause, we would think about that loved one that as they went through their experience they had to try to figure out how they were going to pay the price tag.

And this is really unfortunate, because after your care the last thing you should be worried about is being handed a bill that is beyond your ability to pay. And for middle and working class New Yorkers, medical bills can be financially devastating.

Working class families often have to choose between paying their medical bills or some of the basic essentials that they need to go through life. And because of the high cost of care, New Yorkers are choosing not to get care at all, and any doctor or medical expert will tell you your preventive or the earlier you get in for your care and your treatment is your better chances of to reverse whatever medical condition you're going through. Delaying, putting off and sometimes not getting the care at all could impact the long term health of New Yorkers.

For far too long, medical debt has been a barrier to healthcare and to opportunity. For too long New Yorkers have been saddled with medical debt that they cannot afford. And thank you, the homeless hero is here, Shams DaBaron.

And taking on medical debt isn't a choice. As I stated, it makes a huge difference in the quality of life. Getting healthcare shouldn't be a burden that weighs on New Yorkers and families.

So today, the administration is helping deliver relief to working class New Yorkers with our life changing medical debt relief program. And just really good stuff when you look at the investment that we are making. We're investing $18 million over three years to forgive over $2 billion in medical debt for hundreds of thousands of New Yorkers.

Let me repeat that: $18 million is going to relieve $2 billion in medical debt. The program… If you were sitting down, you'd be standing up for this one, giving a standing ovation. 

The program will wipe out debt for up to a half a million New Yorkers on a one time basis, and will be the largest municipal initiative of its kind in the country.

I just really want to thank RIP Medical Debt for really moving to have medical debt Rest In Peace as we move forward. This is a national, New York City based company, non profit that is partnering with us to get this done. RIP Medical, really thank you so much.

Medical debt, it's the number one cause of bankruptcy — number one cause — and we often don't even realize how this is impacting the lives of everyday New Yorkers because it's a spiraling impact. We have to file for bankruptcy, it impacts your credit scores, it impacts your ability to purchase a home, it impacts your ability to even now being hired is based on people look at your credit scores.

So, this spiraling impact for someone that has an unfortunate incident in their life is now going to cripple their lives in a real way, and that is why we are moving forward with this important announcement.

And we're clear. This disproportionately affects uninsured, under insured and low income households. The numbers are very clear: Black and Latino communities are more likely to be uninsured, under insured and from low income households.

So, we can't ignore this. Here in New York City, we believe healthcare is not a privilege, but it's a right. It's a right that every New Yorker deserves. And since day one, this administration has been driven by a clear mission: protect public safety, revitalize our economy and make this city more livable for working New Yorkers, and relieving medical debt is going to ensure that we fulfill that obligation.

The administration will never stop fighting to deliver relief to New Yorkers on all aspects of their lives, and this is a huge announcement that we're making today. I want to thank all those who are involved. Thank you.

Deputy Mayor Williams-Isom: Thank you. This is a big deal and a good day. So, people say to me often, when do you sleep and how do you do the work that you do? And what I learned a long time ago is what you need to do is just hire people that are smarter than you and who are able to do the work. I think one of the things I'm so lucky about is that I have the most talented and most dedicated commissioners in my portfolio.

I don't know when you sleep, between Covid, between the work that you've been doing and leading us on mental health, your focus on youth mental health, the opioid crisis, and now this. We are just so lucky to have you. I am blessed to have you in my life, and thank you for all that I've learned from you in the past two years. Commission Vasan.

Commissioner Ashwin Vasan, Department of Health and Mental Hygiene: Thank you. Thank you, deputy mayor. It's a privilege to serve. And today is one of the special days that I'll remember for the rest of my life. It's a great day.

As a practicing doctor for the last decade or more, I've too many times seen people forced to choose between seeking the healthcare they need and financial hardship. High healthcare costs and the medical debt that all too often ensues can force impossible choices: do I get the scan, the surgery or the treatment; or, do I buy groceries this week?

Do I risk falling behind on rent? These are the really real, the very real trade-offs that too many of our neighbors and loved ones and my patients have been forced to make due to debt and the specter of debt. Choices that no one should have to make.

The evidence is clear that people who struggle with medical debt or to pay their healthcare care bills are sicker, more likely to have high blood pressure, worsen mental health and shorter life expectancy. And of course, there are stark racial and income disparities in those data. That's why I'm so proud of this announcement today.

Our administration is standing up for the health and well being of working class New Yorkers and hundreds of thousands of people: up to 500,000. New Yorkers and their families are going to have their lives changed because of this program, because healthcare is not a luxury, it's not a commodity, it is a right. It's about saving and improving lives and it's a moral calling.

The New York City Health Department is excited to launch this historic debt relief initiative today. It's not just an important program on its own, but it's an important reminder that public health is about protecting the entire public, beyond any single institution, and sometimes protecting people from the systems that can get in the way of their health.

Through our partnership with RIP Medical Debt, we are answering healthcare's moral call to ensure that our fellow New Yorkers can rest just a bit easier tonight and to live healthier, longer lives, by easing their burdens, even just a little bit, and even if just for a little while.

The launch of this program makes me so proud to be a New Yorker today, so proud to be your city's doctor today and every day. Thank you so much. Thank you to the mayor. Thank you to the deputy mayor.

Deputy Mayor Williams-Isom: It is always so important to have someone who can speak to personal experiences. It's why I keep Brother Shams close to me all the time, so that when you get it twisted and you get ungrounded and don't know what this looks like on the ground, you can stay connected.

So, we are very happy to have today someone who can speak to one of the 500,000 that are going to be affected and to speak of their personal experience. Drew Mehalek, I'd like to bring you up to say a couple of words.

Drew Mehalek: Thank you. Good morning, everybody. My name is, thank you. My name is Drew Mehalek. I am currently a resident of Astoria, Queens. I know firsthand how crushing medical debt can be.

A few years ago I was attending college in a small western Pennsylvania town, and I was walking home from a night class after an ice storm. I slipped and I hit my head on a curb. I've had several previous concussions, and I know that seeking medical attention was not optional, but absolutely necessary.

Knowing ambulance rides were often expensive or not covered by insurance, I immediately called my brave friend who risked driving to pick me up after that dangerous ice storm and taking me to the emergency room at our small regional hospital.

While I was waiting to be seen, the anxiety and being unsure of whether or not my visit would be covered was mounting, so I spoke to the front desk about whether or not insurance would cover the cost. At the time, I was on my parents' insurance, and I was told that the treatment I would receive that evening would all be in network, so of course, I went ahead and I proceeded with the treatment.

A few weeks later, I got a bill from the hospital for over 10 times the amount that I was told my copay would be. This was entirely unexpected; and as a college student, there was absolutely no way I could afford to cover a surprise $1,000 plus expense. I couldn't pay off the debt. I was working a part time job and being a full time student. I had neither a penny nor a second to spare. And I was working to put food on my table, pay my rent; and, any extra time I had after that was going to my studies.

Unfortunately, like millions of other people, a $1,000 unexpected bill was not something I could afford. The heavy burden of both the debt on my financial and mental health was mounting.

Of course, I hoped to be able to afford to pay off my medical debt; however, between moving, student loans and rent payments, I could hardly stay ahead of expenses that were necessary to keep a roof over my head.

The several letters and phone calls I received each month regarding my medical debt began to blend into background noise I almost learned to instinctually ignore knowing that picking up that call or opening that letter would just be another humiliating slap in the face about debt I couldn't afford.

Then one day, I got a letter that looked a little bit different from the others; this time, from a group called RIP Medical Debt, I decided to open the envelope and saw a notice informing me that my medical debt had been 100 percent forgiven.

I remember being home with my girlfriend at the time, staring at the sheet of paper in my hand, shaking in disbelief. I thought that this was just part of an increasingly elaborate way by debt companies to contact me.

So, as I researched the letter and the company, much to my surprise and overwhelming joy, I found that my medical debt had indeed been completely forgiven. I'm now 28 years old, and as I think about settling down and starting a family, it's such an enormous relief to know that my medical debt — which I received due to no fault of my own — is no longer dragging behind me like a ball and chain.

When I think back to that night that I received my injury, I remember that I hadn't yet lifted myself from the ice when I was thinking, oh, God, what's this going to cost me? My first thought wasn't about how severe my injury was, it wasn't about how I was going to get to the hospital, and it wasn't about recovery.

The unfortunate fact of the matter is that this is the reality for millions of people not only here in New York, but across the country. No one chooses to get sick, no one chooses to get injured, but when they are, the primary concern should be the recovery, not the financial, emotional and mental strain of medical debt.

It's with great pleasure that I'm here speaking with you all today, and I thank you all for listening this far. Receiving medical debt relief changed my life, and I'm one of the lucky ones. Individual acts of kindness alone cannot shoulder the full burden brought about by the systemic issue.

That's why I'd like to thank the City of New York for making an immensely valuable investment in our communities in order to bring this life changing program to the largest city in the country. My heart goes out to all of those with stories similar to my own that this program will reach, and I'm thrilled that hundreds of thousands of New Yorkers will get the same second chance that I did. Thank you.

Deputy Mayor Williams-Isom: Thank you so much. That was perfect, and you gave voice to so many millions of people around the country who are in a similar situation. So, thank you so much, Drew. Now I'd like to bring forward Allison Sesso… Say your last name.

Allison Sesso, President and CEO, RIP Medical Debt: Sesso.

Deputy Mayor Williams-Isom: President and CEO of RIP Medical Debt to say a few words. I should know how to say Allison's name. She has been an advocate in the human service sector for a very, very long time, and we are so happy to have her here today and doing the work that she is doing now. Allison?

Sesso: Thank you so much. Drew, I just want to commend you for being brave to tell your story. I know that medical debt can be painful for people and I appreciate that you gave voice to your situation and what it means to have it relieved.

And that's what we're doing at RIP Medical Debt every day, and we're thrilled, thank you to the mayor, for bringing this program here. We are located here, are headquartered here. The idea was founded just a few blocks away from here 10 years ago, and here I am today talking about this $18 million incredible investment to get rid of $2 billion dollars of medical debt. And I am, like, thrilled as is the entire RIP community, our board, our team.

A lot of hospitals work with us because they recognize that this is an issue that they are grappling with as well. We have hospitals across the country that are coming to the table, and we're excited that they'll be working with New York based hospitals as well.

And we've been talking to many of them and we'll be excited to be telling you about those many more letters like Drew received in some in a short period of time. They do it, I think, the hospitals because they do recognize that the first thought unfortunately for a lot of people when they get sick is, what's this going to cost me, and that's just not okay. It's a big problem throughout the United States.

And what we're doing is we're relieving this burden for individuals. We understand that we're not solving the bigger problem, and I know many people gave voice to that, and that is one that we get behind. But it's something we can do today.

And you know, as we often say we can walk and chew gum at the same time, right? We can solve this problem and remove this burden while thinking about larger solutions that can solve this. We've been able to get rid of $11 billion of medical debt across the country to date, helping over seven million families, and we're just escalating up our efforts because the issue needs our attention.

It is hurting families financially. More and more people don't have $500 to, I think half of Americans don't have $500 to deal with an emergency, yet insurance expects you to pay way more out of pocket these days. The underinsured are really a large represented group that's being impacted by medical debt today.

And we're really setting up individuals for failure. The number one reason...predictor of medical debt now is not whether or not you're insured or your insurance status but whether or not you get sick. So, that's the message that we receive from people like Drew that get the letters. They say, you know, thank you so much. I feel like I'm caught in a trap. And they're not wrong.

So, we're here to bring this program to the city. We're excited to work with the hospitals. It really aligns with their missions, that's why so many of them do this work, because they recognize that this delay and avoid care for people. And they want to make sure that people come to get their services and that they don't delay care and don't further have this mental health burden that medical debt creates for them.

So, we're thrilled to be here. We're excited to be getting out there more and more letters. You can't apply for this program, just want to be clear about that. We will get our hands on the debt and then we will send letters out to individuals and let them know the way we did with Drew.

So, there is no application process, which is a good thing because applications often undermine people's access to programs, and that's often why also even if a hospital has a good financial assistance program in place, they still need our program because people slip through the cracks. They might not fill out the application. And so that's what our program is, it fits really well with what hospitals are already doing.

So, thank you so much for this opportunity, and we look forward to doing a massive debt relief for this great city that we're located in.

Mayor Adams: And our team member, you know, grab Nate. Nate should be up here. Come on here, Nate. Come on up, Nate.

Nate was with me with Borough Hall, this was some of the initiatives, the thoughtfulness. Nate played such a major role in landing this plane. Really, thank you, Nate, for your, you know, your thoughtfulness and innovation.

Question: Mayor, I have two questions, one personal, one kind of one, the program. We've all.... Your story of growing up is well known. I'm wondering if to your knowledge, because often parents hide this from kids, your mom had to deal with a medical debt at any point.

And also, since you can generally known you can do this for such pennies on the dollars, obviously $18 million stretching to $2 billion. And I know we're in a budget crunch, but why not go higher? I mean, $36 million, you extrapolate that out for relative to a city budget such a small amount going so far. Why 18, did you settle on that number?

Mayor Adams: Well, firstly, the dollar amount, and that's a good question. As you stated, we're dealing with some real crises and the team came to me and said we just need to do this. We need to find this $18 million, because we're talking about a $2 billion, 500,000 people we're going to impact.

So, this was a real decision that was really team driven. They came and they presented a good case, the deputy mayor, Dr. Vasan and they said we needed to do it and we had to find the money to get it done.

Would we like to expand it and would we like to tell the country, our national leaders, all of us should be doing this. Yes, we would. We would like to find more money. We're going to use the mayor's fund to also help raise money. So, the more money we're able to find, we could expand, I'm hoping we could have a million people that we could alleviate or eradicate their debt.

And so we're straight ahead. You know, I remember mom walking in her arthritic state to Guy R. Brewer, it was called New York Boulevard at the time, to the hip center. And she would delay going there sometimes because people would say, well, I think it was $15 at the time. Well, it's just a $15 copay. That's not a lot.

It was a lot. And there were many days, you know, she would round up the six of us, and you know, when you look at those copays, they added up. And she would delay it. And she would have some of the children do something and she would hold on.

She suffered from high blood pressure. She suffered from arthritis. She suffered, you know, for a host of now that I learned, food related medical issues. But she would delay, as parents do. Parents sacrifice for their children, and she was a symbol of that sacrifice.

And I'm sure if she would have gotten a letter in a mail telling her, her debt was relieved, it would have been a nice gesture. And so Rest In Peace, R I P is really providing just such an on the ground. I believe your story was just a real personal story that many people could resonate. I hope the woman you were, your girlfriend, you're now, is your boo, you're getting married.

Deputy Mayor Williams-Isom: Don't put him on the spot!

Mayor Adams: You know, but no, so their personal stories, all of us could identify with those stories. What's up, Mike?

Question: Hey, how you doin'?

Mayor Adams: Good, good.

Question: So, I'm just curious to learn more about like how this works, right? And you're paying off billions with millions.

Sesso: Yes.

Question: How does that work? And also, you know, how do you determine who is most in need? I mean, uninsured or in need, clearly, but as far as like underinsured, like how do you determine with the providers like who you want to target for relief?

Sesso: Yes, so let me get… The second part's easier, I think, to explain than the magic of how you turn a couple million dollars into a billion. We get the portfolio from the hospital or medical provider and then we identify everybody through this debt engine that we've created.

It's actually very efficient. It's why we can do this at a pretty low cost. We run this through the system. We buy data that basically presumptively, creates presumptive eligibility for the individuals. And so we identify everyone that's 400 percent of poverty or below or if the debt is 5 percent or more of their income and then we relieve those debts.

So, we just run the analysis and everybody qualifies and everybody gets their debt relief. So we're not picking and choosing, it's just purely based on income.

In terms of how this works and why it works. So, there is a for profit debt market that prices debt very low; and in order for for profits to make money they have to make the cost of that debt very, very low in order to make money back because frankly, the people who owe the debt can't pay it.

We're taking advantage of that pricing and that for profit model and that pricing that exists because of that market, except we're not trying to make any money back. We are turning it into a charitable purpose, and we're getting rid of those debts when we get our hands on it.

So, we're entering a for profit market that's lowering the price, and then we're taking dollars that we are not interested in making a return on and the return is the charitable gift that we're giving to individuals.

Mayor Adams: And I think what's good here is the application process, you know, you would talk with those who are seeking access to governmental resources and then they get those 40 pages of applications and trying to find documents that they can't locate it.

So, the application process becomes a barrier to access. And it's just, you know, you just say, listen, I'd rather go without. And so not having to go through that process is really a smart identifier of how do we get the services to those who are on the ground. That's something that we want to continue to erode the access to services by the processes that the bureaucracy to get these services.

Question: Mr. Mayor, can you also talk about what you'll be doing to actually lower healthcare prices?

Mayor Adams: We have been partnering with not only ACC, 32 BJ, DC 37, all of our unions have been talking about transparency in pricing. We want state lawmakers to look at it and find ways of bringing down the cost of services because you could go to one hospital or one provider and be charged an exorbitant amount and it's almost a quarter of what you find in another provider.

So, we want a holistic approach, not only how do you bring down the cost but how do you prevent the healthcare crisis. And that's what Dr. Vasan has been talking about, you know. This is why we're feeding our children healthier foods at school. This is why we're doing a default plant based menus in our hospitals, H + H hospitals, why we're teaching our professionals from different organizations that's paying for healthcare providers to learn about preventive care through diet and lifestyle.

So, the goal is not to say only how do you bring down the cost, how do you bring down the numbers of people who are accessing a sick care system in the first place? So, we have been partnering with everything that's possible. Everything is on the table of how do we make sure that healthcare is not going to destroy the lives of people. And that's our goal.

And I've got to take my hat off to Henry Garrido, the head of DC 37 and former head of 32 BJ, Kyle Bragg. They met with me when I was running to talk about we've got to bring down the cost. These unions settled their contracts, and a bulk of it, too much of it goes to healthcare cost. We have to bring down the cost, and we have to do be more preventive, something that Dr. Vasan has been talking about.

Question: Hi, Mr. Mayor.

Mayor Adams: How are you?

Question: Good, how are you?

Mayor Adams: Good, good.

Question: My question to you in terms of the budget, this is a great program. I'm sure it's going to help many New Yorkers. I'm wondering, $18 million, could you have used that in some other department that needs, that had budget cuts recently? Many departments might be facing budget cuts in April. Why decide to create this program right now when the city's already facing such fiscal straits?

Mayor Adams: No, we couldn't have. This was a great turnaround. I don't know if people really heard me earlier. $18 million for $2 billion. That's the type of turnaround you want. That's what you call smart fiscal management, because if you are able to save $2 billion in debt, that $2 billion trickles down to those households who are not going to fall into our safety net.

They're not going to fall in our homeless system. They're not going to fall into the lack of providing information for their basic care. They're not going to be in a reactive care, but they're going to be a proactive care.

This is a great investment. And I would find it shocking if anyone that has any fiscal knowledge at all would say spending $18 million to save $2 billion that won't eventually fall into our safety net system. This is a huge win. This is an exciting day for all of us.

And I just want to thank our RIP and the team for really seeing this is smart use of taxpayers dollars. That old saying, you can either pay us now or you could pay us later. Low income, uninsured New Yorkers, the city will pick up the cost of unpaid medical debt one way or the other.

We're saying if we do it early, what is that, a penny saved, a pound foolish, something like that? You know, my mother used to say that.

You know? So, no, this is really, this is a win. You know, you have to be extremely creative to try to find a way to knock what we're doing today. That creativity must be deep.

This is a W. Thank you for all who have done it. Thank you so much. Thank you.

###