New Mexico Legislature Advances Medical Debt Collection Bill

A bill is advancing through the state legislature in New Mexico that would prevent healthcare providers from placing collection accounts or filing lawsuits against individuals who make less than 200% of the federal poverty level while also providing a private right of action should a patient want to sue for an alleged violation of the law.

The New Mexico Senate’s Health and Public Affairs Committee passed the legislation, known as the Patients’ Debt Collection Practices Act on Friday. It now heads to the Senate’s Judiciary Committee for consideration.

A copy of the bill, SB 71, can be accessed by clicking here.

For individuals designated as “indigent patients” because their household income does not exceed 200% of the federal poverty level, healthcare providers would be prohibited from the following actions:

  • Selling a person’s medical debt to another party, including a medical debt collector
  • Reporting adverse information about a patient to a consumer reporting agency
  • Placing a lien on an individual’s property
  • Seizing funds from a bank account
  • Garnishing wages
  • Commencing a civil action

Healthcare providers would also be required to post their prices on their websites. Providers, creditors, and collectors would also be required to send receipts to individuals within 10 days of receipt of payment that include the following information:

  • The amount paid
  • The date payment was received
  • The account balance before the most recent payment
  • The new balance after the application of the payment
  • The interest rate and interest accrued since the last payment
  • The account number
  • The name of the current owner of the debt and, if different, the name of the medical creditor
  • Whether the payment is accepted as payment in full of the debt

Violations of the statute would constitute unfair or deceptive trade practices under the state’s Unfair Practices Act and consumers may sue for injunctive relief or appropriate equitable relief.

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