Here’s What Providers Should Know About New York’s New Hospital Financial Assistance Law

New York hospitals are facing major, State-mandated changes for financial assistance (FA) this year. The new regulations, enacted as part of the State’s health and mental hygiene budget legislation for 2024-2025, are intended to enhance patient protections regarding financial assistance, medical billing and collections procedures.

The new laws are set to go into effect October 2024. Leading up to this date, providers should work to understand what the legislation means for their organization and begin to make any necessary changes to maintain compliance.

What does the law mandate?

The new rules aim to expand and improve financial assistance programs while enhancing patient protections around medical debt collection across New York State. Key provisions include the following.

All hospitals must comply

Prior to October 2024, only hospitals in the State Indigent Care Pool were required to comply with financial assistance and collections laws. Now, all New York hospitals are required to comply.

Income eligibility

Until now, a patient’s income had to be under 300% of the Federal Poverty Line (FPL) to qualify for financial assistance. Hospitals had the option to go higher than this rate at their own discretion. Now, income eligibility has been increased up to 400% FPL. Hospitals may still elect to go higher than this.

Medical debt lawsuits

There have been scattered rulings on medical debt lawsuits over the years, but this is the first comprehensive set of laws to regulate when providers can and cannot sue for uncollected payments. New York hospitals can no longer sue patients with incomes below 400% FPL. In the event of a lawsuit, the hospital CFO must file an affidavit certifying reasonable effort was made to uncover the patient’s income and that it was found to be above 400% FPL.

Payment caps

The new legislation caps the amount hospitals for which hospitals can bill a patient at 5% of their gross family income, down from the previous 10%. Interest rates are now capped at 2%.

Underinsured patients 

Hospitals used to offer financial assistance to underinsured patients at their discretion. The new regulations define an underinsured patient as someone with out-of-pocket medical costs from the last 12 months that add up to more than 10% of their gross income. These patients must pay a certain percentage of insurance cost-sharing on a sliding scale, depending upon where their gross income falls on the FPL.

Determining eligibility

Providers can no longer consider immigration status or asset tests when determining financial assistance eligibility. 

Time limit to apply

Until now, patients could only apply for financial assistance within 90 days of receiving care. Now, patients can apply at any time.

Denial of care for unpaid bills

Hospitals are now officially banned from denying patients care due to unpaid medical bills with the organization.

Next steps for providers

Providers must ensure compliance by the time these new regulations go into effect in October 2024. Hospitals should review existing policies and procedures around billing and debt collection and make any necessary changes or improvements.

If your hospital is using a paper-based system or third-party vendors, compliance will likely become much more difficult. Now is the right time to make an overdue transition and upgrade your internal systems.

How Office Ally can help

The Office Ally team has extensive experience working in New York, and specifically in New York City. We have spent decades navigating and understanding a changing landscape for financial assistance within the state.

We’re pleased to offer the MAPS platform as an all-in-one, customizable solution to support your organization in maintaining compliance with new regulations. To support your organization, MAPS offers the following key features.

Streamlined enrollment

MAPS allows for streamlined enrollment with FA eligibility program rules, including simultaneously assessing Medicaid qualifications. Fully customizable with the providers’ EHR, MAPS offers customized forms and workflows to determine whether or not a patient qualifies for FA, rather than dooming the account to an inevitable writeoff. The platform also offers tracking, allowing providers to see accounts through the system from the moment self-pay patients hit the queues all the way through to application decisions for FA.

Patient Engagement Portal

The MAPS-Clear patient portal puts the FA process right in the patients’ hands. Patients can self-screen to see what programs they may qualify for, eliminating the need for employee time and resources dedicated to screening. 

The patient portal fits in seamlessly with existing workflows and can be easily accessed via a website or QR code. As the experts, Office Ally has ensured the portal screening process is compliant with New York state laws and federal laws while empowering patients to take charge of their medical billing situation.

Reporting Requirements

MAPS can handle the required data collection, providing detailed, regulatory-compliant reports. This includes federal compliance with 501r policies and compliance with New York state regulations. 

Using MAPS can help facilitate compliance for providers in New York while requiring minimal employee training and time, as regulations are integrated into the system. Learn more about MAPS and its role in FA compliance here.

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