N.M. Gov. Signs Medical Debt Collection Bill Into Law

Gov. Michelle Lujan Grisham of New Mexico signed 50 bills into law yesterday, including one that aims to protect low-income residents of the state from incurring medical debts by preventing healthcare providers from placing collection accounts or filing lawsuits against certain low-income individuals, according to a published report.  

The bill, SB 71, also provides a private right of action should a patient choose to sue for an alleged violation of the law’s provisions.

Gov. Lujan Grisham had until the end of the week to sign the bill into law or veto it.

Called the Patients’ Debt Collection Practices Act, the bill will go into effect on July 1.

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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