Colo. Legislative Committee Kills Bill That Would Limit Garnishments of Medical Debt

A bill that was proposed in the Colorado legislature that would limit what could be garnished from an individual’s wages if the judgment was for medical debt was postponed indefinitely by the state’s Finance Committee on Monday, despite pleas that the law was sorely needed.

Colorado HB19-1089, the Exemption From Garnishment For Medical Debt, was introduced last month by Rep. Kerry Tipper, a Democrat who is vice chair of the Finance Committee. Rep. Tipper had vowed to pass the bill following the death of her father, Ed Tipper, a World War II veteran.

“You find yourself in a position where your whole world feels like it’s spinning out of control,” Tipper said of the medical debts her father incurred, despite having insurance. “You’re grieving. You’re stressed out. At the end of my dad’s life, there were decisions he had to make about his care that really dealt more with what they could afford and frankly what would be left for my mom when he was gone.”

The bill would have exempted an individual’s earnings from garnishment or judgment if the person’s family income did not exceed 400% of current federal poverty guidelines and was related to medical debts.

The Finance Committee voted 7-4 to indefinitely postpone consideration of the bill.

One published report included a comment from a representative of the credit and collections industry.

“Most of our clients are optometrists, dentists, physical therapists, family practice doctors,” said Scott Allely, who was referred to as a collections industry representative, but whose LinkedIn Profile lists him as the president and chief executive of Allegiant Receivables Solutions. “These providers rely on the money we collect for them and return it to sustain their practices and their employees.”

Rep. Tipper said she next plans to introduce a bill that would eliminate property liens for medical debt.

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