Nobody will argue with the fact that the amount of medical debt in the United States has surged to new levels. In what could become a difficult situation for companies in the accounts receivable management industry, a growing number of state legislators are actively seeking to address the problem and create their own versions of remedies. In anticipation of a lack of consensus at the federal level, numerous states are pushing forward their medical debt laws to protect consumers from the financial burdens and the subsequent consequences that can impact their credit scores and overall well-being.
Several states are taking bold measures, according to a published report:
- North Carolina: Proposed legislation aims to cap interest on medical debt collections, prevent collectors from foreclosing on properties or garnishing wages, and regulate how this debt is reported to consumer agencies.
- Oregon: A law was passed this year that limits interest on medical debt and mandates that non-profit hospitals screen patients with bills over $500 for financial aid.
- Illinois: Hospitals now have to screen patients for financial assistance and employ cost-reducing strategies before escalating bills to collections.
- Colorado: The state has prohibited consumer reporting agencies from factoring medical debt into credit reports, while also obligating debt collectors to notify individuals that their medical debt will not affect their credit score.
- New York: A similar approach has been adopted to that of Colorado.
Like many articles that have addressed this issue, this one spotlights a symptom of the problem, but fails to provide ideas that might serve as a solution. Nobody disagrees with the fact that medical debt is a problem for many people in the United States, but there’s a reason why these facilities have to file lawsuits to try and collect on unpaid debts. They may operate as non-profit facilities, but they still do have expenses to cover. And if consumers are going to not attempt to repay their debts, especially if they don’t have to worry about it showing up on their credit report, what other option do healthcare providers have?