No. HB 1271
Filed under Healthcare.
Medical Debt; Revises definition of term "extraordinary collection action" & defining term "prohibited collection actions."
Plain English Summary
AI-GENERATEDSelling a patient's medical debt to a collector no longer automatically counts as an extraordinary collection action. It is exempt if the hospital's written agreement with the buyer bars prohibited collection tactics, caps interest, and lets eligible patients' debt be recalled.
A new definition of prohibited collection actions lists tactics medical creditors and debt collectors cannot use, including threatening arrest, seizing bank accounts, garnishing wages, foreclosing on real property, and reporting the debt to a credit bureau.
The revised list also adds seizing state or federal tax refunds and credits as a prohibited tactic, a category the current law does not mention at all.
At the same time, a current rule is deleted -- the one that treated deferring, denying, or demanding payment before giving medically necessary care over an unpaid, financial-assistance-eligible bill as an extraordinary collection action. Nothing replaces it.
AIDeferring, denying, or requiring payment before providing medically necessary care because a patient has not paid an earlier bill covered by the facility's financial assistance policy is deleted from the definition of an extraordinary collection action, with no replacement.
AISelling a patient's debt to another party no longer automatically counts as an extraordinary collection action if, before the sale, the creditor has a binding written agreement with the buyer meeting specific consumer-protection criteria.
AIA new 'prohibited collection actions' definition lists specific tactics barred when collecting health care debt, including threatening arrest, obtaining a lien or foreclosing on real property, garnishing wages, and reporting the debt to a consumer reporting agency.
AIAs one condition of that exemption, the debt must be returnable to or recallable by the medical creditor if the creditor or buyer determines the patient is eligible for financial assistance.
AIThe new prohibited-actions list bars state or federal tax offsets used to seize a patient's tax refunds or tax credits to collect medical debt, a category not present in the current definition at all.
AIThe prior rule barred attaching or seizing a patient's bank account or any other personal property. The new prohibited-actions list keeps the bank-account language but drops the broader reference to other personal property.