What's happening
This bill amends rules on restraining judgment debtors’ bank accounts, excluding insurer or HMO payments owed to healthcare providers from protected funds.
Why it matters
Direct payments from insurers or HMOs to patients that are then owed to healthcare providers are no longer protected from bank account restraints. this means those funds can be seized to satisfy a judgment, potentially affecting how quickly providers get paid.
Judgment debtors (people who owe court-ordered debts) will have less protection for money in their bank accounts if it consists of insurance or HMO payments meant for medical bills. making it easier for creditors to access these funds, which could impact individuals' ability to pay for healthcare.
The amendment could influence how health care providers seek payment from patients versus insurers. , possibly leading to changes in billing practices, such as requiring direct payment from insurers to providers rather than routing funds through patients.
By narrowing the definition of protected funds, the bill could increase the financial vulnerability of judgment debtors. , especially those dealing with large or unexpected medical expenses, as more of their assets become available to creditors.
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Who cares
Headline styles
Protect Debtors’ Bank Accounts
Plain English, a few words. Used as the page title.
Sponsors
3 Co-sponsors
History
- Held for consideration in judiciary
- Referred to judiciary
- Referred to judiciary
Full text
2 pagesUnderlined is new[Struck] is removedOfficial text on nysenate.gov ↗
STATE OF NEW YORK
3154
2017-2018 Regular Sessions
IN ASSEMBLY
January 27, 2017
Introduced by M. of A. RAIA, MONTESANO, FINCH, McLAUGHLIN, McDONOUGH -- Multi-Sponsored by -- M. of A. CROUCH, GOODELL, M. G. MILLER -- read once and referred to the Committee on Judiciary
AN ACT to amend the civil practice law and rules, in relation to the effect of restraint on judgment debtor's banking institution account
The People of the State of New York, represented in Senate and Assembly, do enact as follows:
Section 1. Subdivision (i) of section 5222 of the civil practice law and rules, as added by chapter 575 of the laws of 2008, is amended to read as follows:
(i) Effect of restraint on judgment debtor's banking institution account. A restraining notice issued pursuant to this section shall not apply to an amount equal to or less than the greater of two hundred forty times the federal minimum hourly wage prescribed in the Fair Labor Standards Act of 1938 or two hundred forty times the state minimum hourly wage prescribed in section six hundred fifty-two of the labor law as in effect at the time the earnings are payable (as published on the websites of the United States department of labor and the state department of labor) except such part thereof as a court determines to be unnecessary for the reasonable requirements of the judgment debtor and his or her dependents. All or any portion of this amount derived from the payment by an insurer or health maintenance organization to an insured that is legitimately owed by such individual to a health care provider for services rendered shall be excluded from such calculation. This amount shall be equal to seventeen hundred sixteen dollars on [the effective date of this subdivision] January first, two thousand eleven, and shall rise to seventeen hundred forty dollars on July twenty-fourth, two thousand nine, and shall rise thereafter in tandem with the minimum wage. Nothing in this subdivision shall be construed to limit a banking institution's right or obligation to restrain or remove such funds from the judgment debtor's account if required by 42 U.S.C. § 659 or 38
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[ ] is old law to be omitted.
LBD06840-01-7
A. 3154 2
U.S.C. § 5301 or by a court order. Where a judgment debtor's account contains an amount equal to or less than ninety percent of the greater of two hundred forty times the federal minimum hourly wage prescribed in the Fair Labor Standards Act of 1938 or two hundred forty times the state minimum hourly wage prescribed in section six hundred fifty-two of the labor law as in effect at the time the earnings are payable (as published on the websites of the United States department of labor and the state department of labor), the account shall not be restrained and the restraining notice shall be deemed void, except as to those funds that a court determines to be unnecessary for the reasonable requirements of the judgment debtor and his or her dependents. Nothing in this subdivision shall alter the exempt status of funds which are exempt from execution, levy, attachment or garnishment, under section fifty-two hundred five of this article or under any other provision of state or federal law, or the right of a judgment debtor to claim such exemption.
§ 2. This act shall take effect immediately.
Reflowed for reading: line numbers and page breaks removed. Cite the official text.
Summaries, headlines and scores are AI-generated from the official bill text. How we score bills. Source: NYS Open Legislation.