Maryland Legislature Passes Medical Collection Bills

The Maryland Senate and House of Representatives each have voted unanimously to approve their own versions of a bill that affect how medical debts are collected, but opponents of the measure were able to get a key provision removed from the bills that would have established a threshold for which collection lawsuits could be filed.

The bills, HB0565 and SB0514 now move into the legislature’s other chamber for consideration. Both bills are backed by Democrats and Republicans, creating expectations that the bill will ultimately become a law.

Under the proposed legislation, hospitals would be prohibited from charging interest or fees on certain debts, prohibited from garnishing the wages of individuals who qualify for reduced or free medical care, and require that patients be offered payment plans that do not exceed 5% of their income.

The original versions of the bills would have barred collection agencies and healthcare providers from filing collection lawsuits if the amount owed by the patient is less than $1,000 or sending any bill to a collection agency if the amount owed was less than $1,000. The bill would also bar spouses from being held liable for any unpaid debt. Those provisions were removed after lobbying efforts by the Maryland Hospital Association, according to a published report.

“I don’t think it’s appropriate for the government to put that in a law, because it sends a message that if you get a bill under that amount technically the hospitals can’t collect,” said Nicholaus Kipke [R-Anne Arundel], the House Minority Leader.

Healthcare providers would be required to document the manner in which they informed patients about the availability of payment plans and financial assistance, and will have to file annual reports detailing the number of collection lawsuits that are filed.

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