State Legislation Round-Up

Delaware – SB 344

In late June, Senator Spiros Mantzavinos introduced Senate Bill 344, An Act to Amend Title 6 of the Delaware Code relating to medical debt.

This Act claims to protect patients from unfair debt collection practices for medical debt, including prohibiting large healthcare facilities from charging interest or late fees. It also requires facilities to offer reasonable payment plans, limits the sale of debt to debt collectors unless an agreement is made to keep protections in place, provides minimum time before certain collections actions may be taken, limits liability for the medical debt of others, and prevents the reporting of medical debt to consumer credit reporting agencies for at least one year after the debt was incurred.

This bill is currently awaiting consideration in the Senate Banking, Business & Insurance Committee as of June 29, 2022, but is one hospitals and providers may want to watch.

North Carolina – HB 1039

North Carolina Representatives introduced House Bill 1039, Medical Debt De-Weaponization Act, near the end of May 2022. The measure claims to reduce burdensome medical debt and protect patients in their dealings with medical creditors, medical debt buyers and medical debt collectors.

According to the bill, healthcare facilities would be required to create Medical Debt Mitigation Policies that would be built on their existing financial assistance plans. Healthcare facilities would also be required to expand charity care and financial assistance plans, and also take a series of steps before sending the first bill to the patient. Attempting to collect on debts while bills are in the insurance appeals process would be prohibited, and interest on unpaid medical debts would be capped at two percent. There would be new limits on reporting medical debts to credit reporting agencies established, and individuals would have a private right of action against any medical creditor or debt collector.

This bill could have a detrimental impact on a facility’s ability to provide quality care to their patients.

New York – AB 3470/SB 2521

In New York, AB 3470/SB 2521 has passed both the Assembly and the Senate and is waiting to be delivered to the governor. These measures require a hospital to provide the patient (or survivor/legal guardian) a consolidated itemized statement detailing in plain language, the specific nature of charges or expenses incurred by the patient.

The statements must include:

• Services provided by hospital-based physicians and other healthcare providers who may not bill separately.
• No generalized category of expenses such as “other” or “miscellaneous” or similar categories.
• A list of drugs by any brand or generic name and not refer to drug code numbers when referring to any drugs.
• Specifically identify physical, rehabilitative, occupational, or speech therapy treatment by date, type, and length of treatment when these treatments are a part of the statement or bill. Providers of these services cannot produce separate bills.
• The telephone number of the facility’s patient liaison responsible for expediting the resolution of any billing dispute between the patient, or the patient’s survivor or legal guardian, and the billing department. This number must be prominently displayed.

It prohibits a hospital or health system from billing or seeking payment from a patient for a facility fee that is not covered by the patient’s health insurance carrier unless the patient was notified prior to the date of service that a facility fee would be applicable.

Connecticut – SB 411

Medical Debt and its impact on credit scores is the topic of a bill introduced earlier this year in Connecticut. SB 411 was introduced in March, but has not moved past a public hearing held shortly after it was introduced.

This bill moved to place limitations on reporting medical debt to consumer reporting agencies for both insured and uninsured patients by directing the Insurance Department to adopt regulations establishing a minimum amount of a claim or debt that can be reported to a consumer reporting agency.

It would allow the reporting of the following types of medical debt:

• Medical debt classified as currently not collectable. This means the Insurance Department has exhausted available collection efforts, including referrals for administrative offset and enforced collection.
• Medical debt not owed by an insured or uninsured patient who is determined by the Insurance Department to be catastrophically disabled or has reported a gross household income below the applicable geographically adjusted income limits that would entitle an insured or uninsured resident to cost-free health care medications or beneficiary travel.
• The outstanding medical debt amount is greater than twenty-five dollars, or such higher amount as prescribed by the Insurance Department in accordance with current law. The minimum threshold does not apply if there is an indication of fraud, misrepresentation or bad faith on the part of the insured or uninsured resident in connection with the medical debt.

Colorado – HB 1198

This bill was mentioned in an earlier article and became effective in June 2022. Colorado HB 1198, Healthcare Requirements for Indigent Patients, states that healthcare facilities and healthcare professionals shall screen uninsured patients for eligibility for public health insurance programs, discounted care through the Colorado Indigent Care Program (CICP), and discounted care as described in the act.

It also declares that healthcare facilities must use a single, uniform application from the Department of Healthcare Policy and Financing when screening patients. If a health-care facility determines a patient is ineligible for discounted care, the facility shall provide the patient notice of the determination and an opportunity for the patient to appeal the determination.

The bill also limits the amounts charged to no more than the discounted rate established by the department, and hospitals are not allowed to collect monthly installments of more than 4% of the patient’s monthly household income for bills from healthcare facilities, and no more than 2% on bills from each licensed healthcare professional. After a cumulative 36 months of payments, hospitals must consider the patient’s bill paid in full and permanently cease any and all collection activities on any balance that remains unpaid.

Americollect continues to monitor the various legislative actions states take that can impact your revenue. If you have questions about these bills or any others, please contact us today!