Gov. Phil Murphy on Monday signed legislation into law named for a former staffer who lost her life earlier this year in a tragic car accident.

The Louisa Carman Medical Debt Relief Act (Assembly Bill 3861/Senate Bill 2806) passed the Legislature in June. The new law honors the young woman who worked in the governor’s office to help craft the proposal. The measure aims to help New Jersey families avoid falling into medical debt as well as protect individuals from predatory medical debt collections. Louisa Carman was just 25 at the time of the fatal New Year’s Day accident.

“With this legislation, we honor Louisa by carrying forward her mission to ensure every New Jerseyan can access the health care they deserve without breaking the bank,” said Murphy in Trenton.

Some key aspects of the legislation include:

• Prohibits a medical creditor or medical debt collector from:
  • Reporting a patient’s medical debt to any consumer reporting agency for services;
  • Making a consumer report containing a patient’s paid medical debt or a medical debt worth less than $500, regardless of the date the medical debt was incurred;
  • Charging an interest rate on a medical debt of more than 3% per year;
  • Garnishing the wages of a patient with an annual income of less than 600% of the federal poverty level to collect medical debt owed by that patient; or
  • Engaging in any collection actions against a patient until 120 days after the first bill for a medical debt has been sent or against a patient who accepts and complies with the terms of a reasonable payment plan.
• Provides certain protections to patients with medical debt from collection actions by medical creditors and medical debt collectors. Any portion of a medical debt furnished to a consumer reporting agency in violation of the bill will be void
• A medical creditor or medical debt collector that violates a provision of the bill may be subject to a civil penalty and be ordered by the attorney general to restore any moneys or property acquired by means in violation of the bill.

A ‘monumental step’

Caman served as a policy analyst in the Governor’s Office of Health Care Affordability and Transparency. Her family members joined Murphy for the signing, as well as bill sponsors, advocates and other stakeholders.

“The Louisa Carman Medical Debt Relief Act is a monumental step toward building a health care system that is more affordable and more accessible for families all across New Jersey,” said Murphy. “And it will always stand as a testament to the indispensable role Louisa played in transforming our health care system for the better – so we can protect all of our neighbors from being forced to choose between seeking potentially life-saving care or falling into a medical debt trap.”

Lt. Gov. Tahesha Way described Carman as a “valued, brilliant and talented member” of the team. Way said she had dedicated every day to improving the health care system and lives across the Garden State.

“This legislation comes at a critical time where more than 1 in 10 people in New Jersey, and even more in our Black and Brown communities, have medical debt in collections,” said Way. “The Louisa Carman Medical Debt Relief Act would not exist without her passion and advocacy, and it will help thousands of families access the care they need and deserve without fear of financial ruin.”

A lasting testament

“Louisa will be remembered as a young, bright, passionate public servant who cared deeply about policy making to improve people’s lives,” said Shabnam Salih, director of the Office of Health Care Affordability. “Her work gave us the foundation for the critical consumer protections against medical debt provided through this legislation and her work will live on to help so many individuals and their families to be less burdened by the crushing impact of medical debt.”

The Bradlow Carman Family said that Louisa inspired her colleagues, friends and family members to adopt her passion for combatting predatory medical debt collection and ending the indignity of medical debt.

“Louisa joined the Governor’s Office of Health Care Affordability and Transparency in the fall of 2021, and immediately set herself apart as a quick learner and fierce advocate for our most vulnerable neighbors,” said the Bradlow Carman Family. “We thank Gov. Murphy, the bill sponsors, as well as the advocates who ensured that this legislation would be a meaningful and lasting testament to Louisa’s heart, brilliance, and passion for fighting for families struggling with medical debt.”