A quartet of lawmakers, led by Sen. Bernie Sanders [I-Vt.] yesterday announced that they are introducing bills in the Senate and House of Representatives that would wipe out all existing medical debt and remove it from consumers’ credit reports, among other changes. The bill would create a federal grant program to cancel all existing $220 billion of unpaid medical debt, “prioritizing low-resource providers and vulnerable populations.”
Joining Sen. Sanders are Sen. Jeff Merkley [D-Ore.], Rep. Ro Khanna [D-Calif.], and Rep. Rashida Tlaib [D-Mich.]. The congressional website did not yet have details about the Senate bill as of Thursday morning, but information about the House bill, H.R. 8311, can be accessed by clicking here. A copy of the Senate bill — called the Medical Debt Cancellation Act — can be accessed by clicking here.
“This is the United States of America, the richest country in the history of the world. People in our country should not be going bankrupt because they got cancer and could not afford to pay their medical bills,” Sen. Sanders said in a statement. “No one in America should face financial ruin because of the outrageous cost of an unexpected medical emergency or a hospital stay. The time has come to cancel all medical debt and guarantee health care to all as a human right, not a privilege.”
Logistically, the bill would amend the Public Service Health Act to create a grant that would be used to give money to hospitals to eliminate any medical debt that is owed. Hospitals will be required to submit applications to the Secretary of Health and Human Services to receive their funds. Priority will be given to hospitals that are safety net hospitals and agree to cancel all medical debt that is 15 months old or less, is owed by low-income or vulnerable patients, and is attributable to emergency or non-elective care. Two years after the law is enacted, the program would be expanded to providers and facilities other than hospitals to receive the grants.
The bill would also amend the Fair Debt Collection Practices Act to prohibit debt collectors or creditors from collecting or attempting to collect debt that was a result of medical services, products, or devices if the debt was incurred before the law went into effect.
It would also create a private right of action for consumers for any violation of that prohibition. Those suing would be entitled to compensatory and punitive damages.
The bill would also amend the Fair Credit Reporting Act to prohibit the reporting of medical debts.
