Bill > H4809

This bill establishes comprehensive protections for patients dealing with medical debt by creating new legal restrictions and consumer safeguards. The legislation prohibits medical creditors and debt collectors from selling medical debt to debt buyers, reporting medical debt to credit agencies, or using extreme collection tactics like causing a consumer's arrest or foreclosing on their property. The bill requires a 180-day waiting period before initiating collection actions and mandates that healthcare providers give patients at least 30 days' notice before taking extraordinary collection steps. It limits interest rates on medical debt judgments, provides exemptions from wage garnishment and property seizure, and ensures that consumers cannot be denied medically necessary healthcare due to unpaid medical debt. Additionally, the bill requires hospitals and healthcare providers to publicly disclose their medical debt collection policies and prohibits employers from taking adverse actions against employees with medical debt garnishments. Consumers who successfully defend themselves against debt collection actions will be entitled to reasonable attorneys' fees and costs. The law will apply to medical debts incurred and contracts renewed on or after January 1, 2027, with the overall act taking effect on October 1, 2026, representing a significant effort to alleviate the financial burden of medical expenses on patients and families.