Bipartisan legislation aiming to address the growing problem of medical debt in Michigan passed the Senate this week. Medical debt is the number one cause of bankruptcy in Michigan, and nationally, nearly one-third of working-age adults are in debt due to medical or dental bills. Additionally, in her State of the State address last month, Governor Whitmer called for action to be taken to address medical debt.
Key Points:
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- The legislation was sponsored by Senator Sarah Anthony (D-Lansing) and Senator Jonathan Lindsey (R-Coldwater).
- It standardizes the financial assistance programs that nonprofit hospitals are required to provide.
- The bills prevent medical debt from being included in consumer credit reports.
- It caps interest and late fees on medical debt at 3% annually, beginning after a 90-day grace period.
- Prohibits liens and home foreclosures resulting from medical debt.
- Prohibits wage garnishment for patients who qualify for financial assistance.
- Prohibits deferring, denying, and requiring payment before providing emergency or urgent services due to outstanding medical debt.
“The Senate passing these bills marks a significant first step in delivering real relief for our state’s medical debt crisis,” said Senator Lindsey. “Right now, too many Michiganders are burdened by medical debt with limited opportunities to escape it. Senator Anthony has been a leader on this issue, and our partnership on these legislative packages will ensure transparency in charity care and strengthen our state’s laws on medical debt.”
Next Steps:
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- The bill package was referred to the House Health Policy Committee for consideration.
