HOUSE . . . . . . . . No. 4274
The Commonwealth of Massachusetts
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HOUSE OF REPRESENTATIVES, January 25, 2024.
The committee on Consumer Protection and Professional Licensure to
whom was referred the petition (accompanied by bill, Senate, No. 189) of
Liz Miranda for legislation to ease the burden of medical debt, the petition
(accompanied by bill, House, No. 284) of Kip A. Diggs and Jon Santiago
relative to medical debt consumer credit reports, the petition (accompanied
by bill, House, No. 347) of John J. Lawn, Jr., and others relative to
alleviating the burden of medical debt for patients and families, and the
petition (accompanied by bill, House, No. 3564) of Bud L. Williams
relative to medical debt exclusion from creditor, reports recommending
that the accompanying bill (House, No. 4274) ought to pass.
For the committee,
TACKEY CHAN. 1 of 7
FILED ON: 1/22/2024
HOUSE . . . . . . . . . . . . . . . No. 4274
The Commonwealth of Massachusetts
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In the One Hundred and Ninety-Third General Court
(2023-2024)
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An Act alleviating the burden of medical debt for patients and families.
Be it enacted by the Senate and House of Representatives in General Court assembled, and by the authority
of the same, as follows:
1 SECTION 1. The General Laws are hereby amended by inserting after chapter 93L the
2following chapter:-
3 CHAPTER 93M.
4 MEDICAL DEBT PROTECTION ACT.
5 Section 1. As used in this chapter, the following words shall have the following meanings
6unless the context clearly requires otherwise:
7 “Commissioner”, the commissioner of banks.
8 “Consumer”, an individual or patient obligated or allegedly obligated to pay any debt.
9 “Consumer reporting agency”, a person as defined in section 50 of chapter 93.
10 “Disposable earnings”, the remaining portion of a consumer’s wages, salary or
11compensation for personal services, including bonuses and commissions, or otherwise, and 2 of 7
12includes payments pursuant to a pension or retirement program or deferred compensation plan,
13after deducting from such earnings those amounts required by law to be withheld.
14 “External review” means a review of an adverse benefit determination, including a final
15internal adverse benefit determination, and any applicable state external review process,
16conducted pursuant to section 16 of chapter 6D and chapter 176O, a federal external review
17process as described at 42 U.S.C. § 300gg-19, a review pursuant to 29 U.S.C. 1133, a Medicare
18appeals process, a Medicaid appeals process conducted pursuant to chapter 118E and the
19provisions of 103 CMR 613.00, or another applicable appeals process.
20 “Extraordinary collection action” means any of the following:
21 (a) selling a consumer’s debt to another party, except if, prior to the sale, the medical
22creditor has entered into a legally binding written agreement with the medical debt buyer of the
23debt under which all of the following apply: (1) the medical debt buyer or collector is prohibited
24from engaging in any extraordinary collection actions to obtain payment for the care; (2) the
25medical debt buyer is prohibited from charging interest on the debt; (3) the debt is returnable to
26or recallable by the medical creditor upon a determination by the medical creditor or medical
27debt buyer that the consumer is eligible for financial assistance; and (4) the medical debt buyer is
28required to adhere to procedures which must be specified in the agreement that ensure that the
29consumer does not pay, and has no obligation to pay, the medical debt buyer and the medical
30creditor together more than they are personally responsible for paying in compliance with this
31chapter.
32 (b) reporting adverse information about the consumer to a consumer reporting agency. 3 of 7
33 (c) actions that require a legal or judicial process, including any of the following: (1)
34placing a lien on an consumer’s property; (2) attaching or seizing an consumer’s bank account or
35any other personal property; (3) commencing a civil action against an consumer; or (4)
36garnishing an consumer’s wages.
37 “Health care entity”, as defined in section 1 of 6D.
38 “Health care professional”, as defined in section 1 of 176O.
39 “Health care provider”, as defined in section 1 of 176O.
40 “Health care services”, as defined in section 1 of 6D. For the purposes of this chapter,
41these services shall include, but not be limited to, any care, procedures, products, supplies,
42devices or medications.
43 “Medical creditor” means any entity that provides health care services and to whom the
44consumer owes money for health care services, or the entity that provided health care services
45and to whom the consumer owes money for health care services, or the entity that provided
46health care services and to whom the consumer previously owed money if the medical debt has
47been purchased by one or more debt buyers.
48 "Medical debt", any obligation owed directly to a medical facility, a provider of health
49care or a provider of emergency services for the payment of money arising out of any agreement
50or contract, express or implied, for the provision of health care services.
51 “Medical debt buyer” means an individual or entity that is engaged in the business of
52purchasing medical debts for collection purposes, whether it collects the debt itself or hires a
53third party for collection or an attorney for litigation in order to collect such debt. 4 of 7
54 “Medical debt collector” means any person that regularly collects or attempts to collect,
55directly or indirectly, medical debts originally owed or due or asserted to be owed or due
56another. A medical debt buyer is a medical debt collector.
57 “Patient”, a individual who received health care services, provided, that “patient” shall
58include a parent if the patient is a minor, or a legal guardian if the patient is an adult under
59guardianship.
60 “Person”, an individual, a corporation, a partnership, an association, a joint venture, a
61joint stock company, a trust, an unincorporated organization, any similar entity or combination of
62the foregoing.
63 Section 2. (a) Notwithstanding any general or special law to the contrary, the following
64extraordinary collections actions shall not be used by any medical creditor or medical debt
65collector to collect debts owed for health care services: (1) causing an consumer’s arrest; (2)
66causing an consumer to be subject to a writ of body attachment or capias; (3) foreclosing on an
67consumer’s real property.
68 (b) No medical creditor or medical debt collector shall engage in any permissible
69extraordinary collection actions until 180 days after the first bill for a medical debt has been sent.
70 (c) At least 30 days before taking any extraordinary collection actions, a medical creditor
71or medical debt collector must provide to the patient a notice: (1) identifying the extraordinary
72collection actions that will be initiated in order to obtain payment; and (2) providing a deadline
73after which such extraordinary collection actions will be initiated which may be no earlier than
74thirty days after the date of the notice. 5 of 7
75 Section 3. (a) No medical creditor or medical debt collector that knows or should have
76known about an internal review, external review, or other appeal of a health insurance decision
77that is pending now or was pending within the previous 60 days shall: (1) provide information
78relative to unpaid charges for health care services to a consumer reporting agency; (2)
79communicate with the consumer regarding the unpaid charges for health care services for the
80purpose of seeking to collect the charges; or (3) initiate a lawsuit or arbitration proceeding
81against the consumer relative to unpaid charges for health care services.
82 (b) If a medical debt has already been reported to a consumer reporting agency and the
83medical creditor or medical debt collector who reported the information learns of an internal
84review, external review, or other appeal of a health insurance decision that is pending now or
85was pending within the previous 60 days, that person shall instruct the consumer reporting
86agency to delete the information about the debt.
87 (c) No medical creditor that knows or should have known about an internal review,
88external review, or other appeal of a health insurance decision that is pending now or was
89pending within the previous 60 days shall refer, place or send the unpaid charges for health care
90services to a medical debt collector, including by selling the debt to a medical debt buyer.
91 Section 4. (a) Notwithstanding any general or special law to the contrary, interest on
92medical debt shall be limited to the lesser of 3 per cent or an annual rate equal to the weekly
93average one-year constant maturity treasury yield, as published by the Federal Reserve Board,
94for the calendar week preceding the date when the consumer was first provided with a bill for a
95medical debt. 6 of 7
96 (b) The maximum rate of interest established in subsection (a) shall also apply to any
97judgments on medical debt, notwithstanding any agreement to the contrary.
98 Section 5. (a) Notwithstanding section 34 of chapter 235, following property of a
99consumer obligated to pay any medical debt shall be exempt from seizure on execution:
100 (i) estates of homestead as defined in chapter 188, provided, that, for the purpose of this
101section, the declared homestead exemption shall be in the amount of $800,000;
102 (ii) $5,000 in cash or savings or other deposits in a banking or investment institution;
103 (iii) wages equal to the greater of 90 per cent of the debtor's disposable earnings or 60
104times the greater of the federal or the Massachusetts hourly minimum wage for each week or
105portion thereof and the full amount owing or paid to a person as public assistance; provided, that
106in a garnishment action, if the court determines by clear and convincing evidence that the 90 per
107cent calculation on disposable earnings would cause extreme economic hardship to the consumer
108or the consumer’s family, the court may reduce the amount to 5 per cent of disposable income.
109 (iv) an automobile necessary for the consumer's personal transportation or to secure or
110maintain employment, not exceeding $15,000 of wholesale resale value; provided, however, that
111the wholesale resale value of a vehicle owned or substantially used by consumer or a dependent
112who is either a disabled person or a person 60 years of age or older shall be exempt up to
113$25,000 in wholesale resale value.
114 (b) The property subject to the exemptions in this section shall be adjusted annually
115beginning on January 1, 2025 and thereafter on January 1 of each successive year by the increase
116in the cost of living as measured by the percentage increase as of August of the immediately 7 of 7
117preceding year over the level as of August of the previous year of the consumer price index for
118all urban consumers, or its successor index as published by the United States department of
119labor, bureau of labor statistics, or its successor agency, with the amount of the exemption
120rounded up to the nearest $100.
121 (c) An employer shall not take adverse action against an employee or refuse to hire an
122consumer because of one or more garnishments for medical debts or because of obligations that
123any garnishments impose against the employer. An employer who violates this section shall be
124liable in a civil action, action for contempt or other appropriate proceeding to the employee or
125consumer for the wages and employment benefits lost by the employee or consumer from the
126time of the unlawful discipline, suspension, refusal to hire or discharge to the period of
127reinstatement and an additional penalty of not more than $1,000.
128 Section 6. Failure to comply with any provision of this chapter, or any regulation
129promulgated in accordance with the provisions of this chapter, shall constitute an unfair or
130deceptive act or practice under the provisions of paragraph (a) of section 2 of chapter 93A.
131 SECTION 2. Chapter 93M of the General Laws shall apply to consumer medical debts
132incurred and contracts that take effect or are renewed on or after January 1, 2025.
133 SECTION 3. This act shall take effect on October 1, 2024.