Medical Debt Should Not Exist.
The Injustice of Medical Debt
Our health care system systematically pushes people into debt, causing suffering and sacrifices for patients and their families. The scope and severity of the crisis is staggering. This needs to change.
The United States has by far the highest cost for medical care and prescription drugs in the world.
Patients often get hit with catastrophic surprise medical bills from doctors not in their insurance network. And the uninsured are billed for arbitrary amounts far in excess of what the hospital would accept from insurance providers.
Millions of people are struggling to pay medical bills and face relentless harassment by debt collectors.
An entire industry has been created to buy medical debt for pennies on the dollar. They then go after patients and demand payment of the the full amount of the debt, plus interest and attorney fees.
Creditors (even many nonprofit hospitals) often file a lawsuit to collect medical debt that people can’t pay. Most people, however, are not represented by an attorney. So the creditor gets a default judgment and then can garnish wages or attach other property. Unfortunately, filing bankruptcy is often inevitable, a tragic result that should never happen.
Many people forgo medical care, can’t afford prescriptions and are unable to pay other living expenses, often incurring other debt as a result.
Medical Industrial Complex
Why is medical care so costly? We have a corporate medical industrial complex that is driven by profit. Health care has become big business.
Health care lobbyists spend incredible amounts to influence legislation that favors special interests including large corporations, private equity investors, hospitals, insurance companies and drug companies. Hospital and insurance company consolidations are increasing costs. As a result, the United States spends dramatically more on health care than other developed continents.
In most countries medical debt doesn’t exist. It’s a foreign concept. And medical debt shouldn’t exist in America.
Medical Debt Protection Act
A Medical Debt Protection Act is needed to protect people who can’t pay their medical bills from collection action and lawsuits. We need to stop:
Hospitals from charging an uninsured in excess of 200% of the amount that Medicare would pay, or the amount generally billed, whichever is greater.
Hospitals from engaging in balance billing. If a hospital is in network under an insurance plan, all providers at the hospital will be deemed to be in network under the plan for insurance and billing purposes.
Attachment or garnishment of wages, self employment income, social security or other government benefits, a car needed for work, a principal residence or property used in a trade or business to pay medical debt.
Debt collectors from filing a lawsuit to collect a medical bill without an affidavit from the provider that verifies the balance due is correct, and collection is not barred by the statute of limitations.
Attempts to collect late fees or charge interest in excess of 12% per annum.
Filing an action to collect a medical bill more than three year after the medical services are provided.
Notifying any credit reporting agency of any medical debt.
Code Blue Debt Initiative
The goal is to eliminate medical debt.
The strategy will be to encourage businesses to join a groundbreaking initiative - community-led efforts by local businesses to reduce the burden of unaffordable healthcare and medical debt. The vision is to begin by creating a foundation in Boise, Idaho and then expand to other communities.
The Boise Healthcare Foundation will be funded by voluntary contributions from local businesses of $100 - $500 per employee per year to:
Help pay medical debt.
Provide deductible and copay assistance.
Make emergency grants to help with insurance companies failing to provide prior authorizations or denials of coverage.
Distribute funds through an application process to identify those in need and ensure an equitable disbursement of funds.
The foundation will be a 501(c)(3) charitable organization. Contributions will be tax deductible. The foundation will be managed by a diverse board of directors representing businesses, healthcare providers and patients.