Stop medical debt collectors and Maryland
Maryland has in place financial assistance programs, regulations and laws that protect consumers from medical debt and medical debt collectors. The law, known as Senate Bill 776, requires that health care providers and collection agencies follow the policies below.
- Health care providers and hospitals need to set up and adhere to policies that providing free and reduced cost health care services. In addition, they need to ensure patients are aware of these programs, and they must post notices about these assistance programs in areas throughout the facility that are accessible to patients.
- Hospitals need to have standard applications for people to use when applying for financial assistance, and they must provide these applications to all uninsured and / or low income patients. Many also offer free health care.
- If a hospital sends an paid bill to a medical debt collector who then proceeds to collect the balance on behalf of the hospital, the hospital must manage, follow up on, and actively oversee the debt collector’s practices and methods.
- Per the Maryland law, a hospitals can’t sell outstanding medical debts to a debt collection agency. Selling unpaid bills to debt collectors had previously been a way for hospitals to get partial payment on the bill while letting go of their collection responsibilities. When this occurred in the past, this policy often resulted in aggressive, abusive, and sometimes illegal debt collection practices.
- When a consumer receives a bill, the hospitals must also send an easy-to-read information sheet along with the hospital bill that explains who the patient can contact about the bill, how to apply for financial assistance and government programs such as Medicaid or other programs that might help, they need to advise them as to the patient’s rights with respect to the bill, and they need to notify them that they will receive separate medical bills for physician services or what may not be covered.
- Charity care and financial assistance programs are required by Maryland law, and these programs need to provide free or low cost medically necessary care for low to moderate income families and patients. Free health care is provided to patients with family incomes that is at or below 150 percent of the federal government poverty level. Reduced costs must also be offered to other low income patients with total family incomes above 150 percent of poverty levels.
- Hospitals are prohibited from charging interest on medical bills and debts that are incurred by self-pay patients before a court judgment is obtained, so it must go through the legal process.
- Another Maryland law (Health General §19-710) prohibits health care providers and hospitals from collecting from a patient money for for any bills that are owed by a health maintenance organization (HMO) for a covered service, and this process is widely known as balanced billing.
Unfortunately current Maryland laws and regulations still allows liens to be placed on patients’ homes to collect unpaid medical debt, and these liens can even result in foreclosure and the patient losing their home. However, this issue is currently under review by the state government.