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.

A prime example of just how large some corporations have become is UnitedHealth Group which, according to Forbes, in 2023 reported revenue of $371 billion and profits of $22 billion. And this is after paying millions of dollars in compensation to its top executives. The cost of medical care in America is not sustainable.

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.

  • 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 charges are reasonable, the balance due is correct, and collection is not barred by the statute of limitations.

  • Debt buyers from recovering more than they paid for the debt.

  • Attempts to collect late fees, interest or attorney fees. 

  • Filing an action to collect a medical bill more than one year after the medical services are provided.

  • Notifying any credit reporting agency of any medical debt.   

Idaho Medical Indigency Act

The Idaho Medical Indigency Act needs to be repealed. It subjects people who can’t pay their medical debt to collection action and liens.

The Act provides:

  • If a hospital determines a patient is unable to pay for services, they can demand the county pay the hospital.

  • The county then files a lien against all property owned by the patient and may take action to collect from the patient what the county paid the hospital.

  • In some cases, the patient may have been eligible for financial aid but wasn’t aware of that.

  • The lien can’t be discharged even if the patient files bankruptcy.

Medical Debt Fund

A Medical Debt Fund needs to be established.

  • The fund would be a 501(c)(3) charitable with the mission of eliminating medical debt in Idaho.  Contributions would be tax deductible.

  • The fund will provide grants to people who otherwise have no way to pay their medical bills. The fund may help negotiate a reduction in the debt.

  • The fund may also purchase medical debt, which is possible for pennies on the dollar, and then forgive the debt. 

  • People who receive a grant to pay their medical debt, or whose debt is purchased and then forgiven, will be encouraged to make a contribution in whatever amount they can to support the ongoing work of the fund.

  • The fund will also create a web site where people who are struggling with medical debt can share their personal story and request help from donors.