Bill > S214

This bill introduces comprehensive protections for consumers facing medical debt by establishing the Medical Debt Protection Act. The legislation prohibits medical creditors and debt collectors from selling medical debt to debt buyers or reporting medical debt to consumer reporting agencies, effectively shielding patients from negative credit impacts. The bill restricts extraordinary collection actions such as causing consumer arrests, placing liens on property, seizing bank accounts, or garnishing wages, and mandates that medical creditors wait 180 days after the first bill before pursuing any collection efforts. Additionally, the bill requires medical creditors to provide advance notice before initiating collection actions and prevents collections while any internal or external insurance review is pending. It also limits interest rates on medical debt judgments to 3% annually starting in 2026 and provides significant asset exemptions for consumers, protecting assets like homesteads, savings up to $5,000, an automobile, and certain income sources from seizure. Employers are prohibited from taking adverse actions against employees due to medical debt garnishments, with potential penalties for violations. The law will apply to medical debts incurred and contracts renewed on or after January 1, 2027, with the act taking effect on October 1, 2025, representing a significant effort to alleviate the financial burden of medical debt on patients and families.

Labor and Employment

https://malegislature.gov/Bills/194/S214