• Fair Capital

New York State Reduces Medical Debt Statute of limitations (SOL) to Three Years

On April 3, 2020, New York State Governor Andrew Cuomo signed the New York's 2021 Executive Budget into law. Senate Bill S7506B

There is no longer a six-year statute of limitations on medical debt, as there was in the past. Instead, the statute of limitations has been shortened to three years under the new rule.


The new section states the following;

"An action on a medical debt by a hospital licensed under article twenty-eight of the public health law or a health care professional authorized under title eight of the education law shall be commenced within three years of treatment."

While the amendment takes effect immediately (April 3, 2020), the bill is silent as to whether the law will have retroactive effect. However, under New York common law, a statute will generally not be applied retroactively unless the amended statute expressly provides for retroactive treatment. Accordingly, the new three-year statute of limitations for medical debt will cover debts resulting from treatment occurring on or after April 3, 2020.


The SOL is tied to the date of the patient's "treatment" and not the traditional SOL trigger date of contract breach. (The general rule applicable to contract actions is that a six-year Statute of Limitations begins to run when a contract is breached or when one party omits the performance of a contractual obligation.)


Hospitals and health care professionals covered under the new rule should examine existing accounts receivables and consider if accelerated collection efforts are needed.


This change does not explicitly impact the ability to report the delinquent debt to the credit reporting agencies within seven years of the delinquency under the Fair Credit Reporting Act (FCRA).