anyone who's faced a serious health condition knows the medical bills can be crushing this week State leaders announced they're using leftover Federal money from the American Rescue plan to help erase roughly $100 million in medical debt for residents the move is expected to help upwards of 50,000 people who live here a senior correspondent Brenda Flanagan reports this may be just the start it felt like a huge sword above my head Amanda Schlesier is still scrambling to pay for her costly medical treatment after a stage four leukemia diagnosis but she's hoping to be among the almost 50,000 Jersey residents who get some hundred million doar in medical debts forgiven under a new state partnership with a nonprofit called Undue it'll use federal funds to buy and then erase the burdensome bills they could never pay it really shakes you you know you start to wonder if this is is this what my life is worth is this the price tag we go directly to those hospitals and buy their bad debts for pennies on the dollar so as an example a $1,000 debt could be bought for $10 or less Alison Sesso heads undue she says they've signed a contract with New Jersey to eventually spend $1.5 million in federal pandemic Aid buying up unpaid medical debts at deep discounts what happens next so once we get our hands on the debt unlike a for-profit debt buyer we erase it we send letters to individuals and they take no action on their own they get this sort of surprise letter in the mail that says we are this nonprofit organization we've partnered with either XYZ donor or XYZ government entity and we have relieved your debt and you no longer owe it and there is no tax consequences to you either because we're a disinterested third party this first round spent 550,000 in Jersey pandemica Aid to relieve more than 60 $2 million in medical debts for almost 18,000 residents who owed Prime Health Care which has hospitals in Denville Newark Dover and Passaic another 32,000 folks will see 38 million in debt relief and it's just the beginning of millions more in leveraged buyouts Governor Murphy stated with this Strategic investment and our partnership with undo we're wiping the Slate clean for thousands of New Jersey families eliminating their debt and making a real tangible impact on their lives we've gotten rid of 13 billion with a B dollars of medical debt to date and we've done it in all 50 states to qualify Undue requires you to earn four times or below the federal poverty level or 05% or more of your annual income so 400% of poverty uh for a family of three is is making over $100,000 a year um so that is sort of middle class uh working class families that we are targeting Governor Murphy last month signed a bill that immediately barred creditors from reporting most medical debts to credit rating agencies come next July it'll also cap interests on those debts at 3% require payment plans with Grace periods and ban wage garnishment for eligible residents an estimated 1 and a half million new jerseyans struggle to pay medical bills and New Jersey citizen actions Laura Waddell says some ration their health care they don't want to add on to the debt and so they're not uh going to the doctor they're not um you know uh buying the prescriptions that they may need I I have a couple of medications that I cannot afford to take and I have it taken um and that has impacted my health I cannot see um I don't have a PCP right now and so I go to an care and I owe them some money and so I can't go to them without paying Schlesier beaten back the leukemia and she's looking for a job so far she's paid 15,000 in medical bills but owes another five and says she hopes to get a letter from Undue I'm Brenda Flanagan NJ Spotlight news [Music]