The Medical Debt Homestead Protection Act aims to provide financial relief to individuals and families burdened by medical debt, which can lead to bankruptcy and the potential loss of their homes. The legislation recognizes the significant distress caused by medical debt and seeks to prevent the forced sale of a home in bankruptcy cases related to unpaid medical bills.

Under this act, any person aged 18 or older, whether married or single, residing in New Jersey can claim a homestead exemption from attachment, execution, and forced sale due to a judgment for medical debt. This exemption applies to their interest in a dwelling house, a condominium or cooperative, or a manufactured home, including the land it occupies. However, the act stipulates that only one homestead exemption can be held at a time by an individual or a married couple. The act is set to take effect 90 days after its enactment.