EXPLANATION: CAPITALS INDICATE MAT TER ADDED TO EXISTIN G LAW.
[Brackets] indicate matter deleted from existing law.
Underlining indicates amendments to bill.
Strike out indicates matter stricken from the bill by amendment or deleted from the law by
amendment.
*hb0765*
HOUSE BILL 765
J3 EMERGENCY BILL 5lr0749
SB 1006/24 – FIN
By: Delegate Ivey Delegates Ivey, Spiegel, Pena –Melnyk, Cullison, Alston,
Bagnall, Bhandari, Guzzone, Hill, S. Johnson, Kaiser, Kerr, Lopez,
Martinez, Rosenberg, Taveras, White Holland, Woods, Woorman, and Ross
Introduced and read first time: January 29, 2025
Assigned to: Health and Government Operations
Committee Report: Favorable with amendments
House action: Adopted
Read second time: March 1, 2025
CHAPTER ______
AN ACT concerning 1
Hospitals – Medical Debt Collection – Sale of Patient Debt 2
FOR the purpose of authorizing a hospital, under certain circumstances, to sell the medical 3
debt of patients if the debt is sold to a governmental unit or an entity under contract 4
with the unit or to a nonprofit organization for the purpose of canceling the debt; 5
requiring that a hospital’s financial policy require the hospital to dismiss actions 6
pending against a patient for the collection of debt that was sold and prohibit the 7
hospital from engaging in specified collection activities on patient debt that was sold; 8
requiring a purchaser of medical debt to notify the patient of certain information and 9
to take certain other actions; and generally relating to hospital debt collection 10
policies and the sale of patient debt. 11
BY repealing and reenacting, with amendments, 12
Article – Health – General 13
Section 19–214.2(a), (b), (f), (m), and (n) and 19–219(a)(3) 14
Annotated Code of Maryland 15
(2023 Replacement Volume and 2024 Supplement) 16
BY adding to 17
Article – Health – General 18
Section 19–214.2(m) 19
Annotated Code of Maryland 20
(2023 Replacement Volume and 2024 Supplement) 21 2 HOUSE BILL 765
SECTION 1. BE IT ENACTED BY THE GENERAL ASSEMBLY OF MARYLAND, 1
That the Laws of Maryland read as follows: 2
Article – Health – General 3
19–214.2. 4
(a) (1) Each hospital annually shall submit to the Commission: 5
(i) At times prescribed by the Commission, the hospital’s policy on 6
the collection of debts owed by patients; and 7
(ii) A report including: 8
1. The total number of patients by race or ethnicity, gender, 9
and zip code of residence against whom the hospital, or a debt collector used by the hospital, 10
filed an action to collect a debt owed on a hospital bill; 11
2. The total number of patients by race or ethnicity, gender, 12
and zip code of residence with respect to whom the hospital has and has not reported or 13
classified a bad debt; [and] 14
3. The total dollar amount of the charges for hospital services 15
provided to patients but not collected by the hospital for patients covered by insurance, 16
including the out–of–pocket costs for patients covered by insurance, and patients without 17
insurance; AND 18
4. FOR HOSPITAL DEBTS OW ED BY PATIENTS OF TH E 19
HOSPITAL THAT THE HO SPITAL SOLD TO A GOV ERNMENTAL UNIT OR, CONTRACTOR , 20
OR NONPROFIT ORGANIZ ATION UNDER SUBSECTION (M) OF THIS SECTION: 21
A. THE TOTAL DOLLAR AMOU NT OF THE DEBT SOLD BY 22
THE HOSPITAL FOR THE REPORTING YEAR ; 23
B. THE TOTAL DOLLAR AMOU NT PAID TO THE HOSPI TAL 24
BY THE UNIT OR, CONTRACTOR , OR NONPROFIT ORGANIZ ATION WHO PURCHASED 25
THE DEBT; AND 26
C. THE TOTAL NUMBER OF P ATIENTS WHOSE DEBT W AS 27
SOLD, IN FULL OR IN PART , TO THE UNIT OR, CONTRACTOR , OR NONPROFIT 28
ORGANIZATION WHO PURCHASED THE DE BT. 29
(2) The Commission shall post the information submitted under paragraph 30
(1) of this subsection on its website. 31
HOUSE BILL 765 3
(b) The policy submitted under subsection (a)(1) of this section shall: 1
(1) Provide for active oversight by the hospital of any contract for collection 2
of debts on behalf of the hospital; 3
(2) [Prohibit] EXCEPT AS PROVIDED IN SUBSECTION (M) OF THIS 4
SECTION, PROHIBIT the hospital from selling any debt; 5
(3) Prohibit the charging of interest on bills incurred by self–pay patients 6
before a court judgment is obtained; 7
(4) Describe in detail the consideration by the hospital of patient income, 8
assets, and other criteria; 9
(5) Prohibit the hospital from reporting to a consumer reporting agency or 10
filing a civil action to collect a debt within 180 days after the initial bill is provided; 11
(6) Describe the hospital’s procedures for collecting a debt; 12
(7) Describe the circumstances in which the hospital will seek a judgment 13
against a patient; 14
(8) In accordance with subsection (c) of this section, provide for a refund of 15
amounts collected from a patient or the guarantor of a patient who was later found to be 16
eligible for free care within 240 days after the initial bill was provided; 17
(9) If the hospital has obtained a judgment against or reported adverse 18
information to a consumer reporting agency about a patient who later was found to be 19
eligible for free care within 240 days after the initial bill was provided for which the 20
judgment was awarded or the adverse information was reported, require the hospital to 21
seek to vacate the judgment or strike the adverse information; 22
(10) Provide a mechanism for a patient to: 23
(i) Request the hospital to reconsider the denial of free or 24
reduced–cost care; 25
(ii) File with the hospital a complaint against the hospital or a debt 26
collector used by the hospital regarding the handling of the patient’s bill; and 27
(iii) Allow the patient and the hospital to mutually agree to modify 28
the terms of a payment plan offered under subsection (e) of this section or entered into with 29
the patient; [and] 30
(11) Prohibit the hospital from collecting additional fees in an amount that 31
exceeds the approved charge for the hospital service as established by the Commission for 32 4 HOUSE BILL 765
which the medical debt is owed on a bill for a patient who is eligible for free or 1
reduced–cost care under the hospital’s financial assistance policy; 2
(12) REQUIRE THE HOSPITAL TO DISMISS ACTIONS P ENDING AGAINST 3
A PATIENT FOR COLLEC TION OF DEBT THAT WA S SOLD UNDER SUBSECT ION (M) OF 4
THIS SECTION; AND 5
(13) PROHIBIT THE HOSPITAL FROM: 6
(I) ENGAGING IN COLLECTION ACTIVITIE S ON 100% OF THE 7
OUTSTANDING AMOUNT O F THE COMMISSION–SET CHARGE FOR DEBT SOLD UNDER 8
SUBSECTION (M) OF THIS SECTION; AND 9
(II) COLLECTING ON JUDGMEN TS ENTERED INTO ON P ATIENT 10
DEBT THAT WAS SOLD U NDER SUBSECTION (M) OF THIS SECTION . 11
(f) (1) For at least 180 days after issuing an initial patient bill, a hospital may 12
not report adverse information about a patient to a consumer reporting agency or 13
commence civil action against a patient for nonpayment. 14
(2) A hospital shall report the fulfillment of a patient’s payment obligation 15
within 60 days after the obligation is fulfilled to any consumer reporting agency to which 16
the hospital had reported adverse information about the patient, INCLUDING IF THE DEB T 17
WAS SOLD UNDER SUBSE CTION (M) OF THIS SECTION. 18
(3) A hospital may not report adverse information to a consumer reporting 19
agency regarding a patient who at the time of service was uninsured or eligible for free or 20
reduced–cost care under § 19–214.1 of this subtitle. 21
(4) A hospital may not report adverse information about a patient to a 22
consumer reporting agency, commence a civil action against a patient for nonpayment, or 23
delegate collection activity to a debt collector: 24
(i) If the hospital was notified in accordance with federal law by the 25
patient or the insurance carrier that an appeal or a review of a health insurance decision 26
is pending within the immediately preceding 60 days; [or] 27
(ii) If the hospital has completed a requested reconsideration of the 28
denial of free or reduced–cost care that was appropriately completed by the patient within 29
the immediately preceding 60 days; OR 30
(III) IF THE HOSPITAL SOLD THE DEBT UNDER SUBSE CTION (M) 31
OF THIS SECTION . 32
HOUSE BILL 765 5
(5) If a hospital has reported adverse information about a patient to a 1
consumer reporting agency, the hospital shall instruct the consumer reporting agency to 2
delete the adverse information about the patient: 3
(i) If the hospital was informed by the patient or the insurance 4
carrier that an appeal or a review of a health insurance decision is pending, and until 60 5
days after the appeal is complete; or 6
(ii) Until 60 days after the hospital has completed a requested 7
reconsideration of the denial of free or reduced–cost care. 8
(M) (1) (I) SUBJECT TO PARAGRAPH (2) OF THIS SUBSECTION , A 9
HOSPITAL MAY SELL DE BT OWED TO THE HOSPI TAL BY A PATIENT FOR HOSPITAL 10
SERVICES TO A GOVERN MENTAL UNIT OR AN EN TITY THAT IS UNDER C ONTRACT 11
WITH THE UNIT OR TO A NONPROFIT OR GANIZATION THAT IS E XEMPT FROM 12
TAXATION UNDER § 501(C)(3) OF THE INTERNAL REVENUE CODE FOR THE SOLE 13
PURPOSE OF CANCELING THE DEBT. 14
(II) THE CONTRACT BETWEEN THE HOSPITAL AND THE 15
GOVERNMENTAL UNIT OR, CONTRACTOR , OR NONPROFIT ORGANIZ ATION 16
PURCHASING THE DEBT UNDER THIS SUBSECTIO N SHALL STATE THAT THE SOLE 17
PURPOSE OF THE SALE OF THE DEBT IS TO CANCEL THE DEB T. 18
(III) THE PATIENT IS NOT RE SPONSIBLE TO THE HOS PITAL, THE 19
GOVERNMENTAL UNIT , OR THE CONTRACTOR , OR THE NONPROFIT ORG ANIZATION 20
FOR ANY AMOUNT OF TH E DEBT THAT IS SOLD UNDER THIS SUBSECTIO N OR ANY 21
INTEREST, FEES, OR COSTS ASSOCIATED WITH THE DEBT OR THE SALE. 22
(2) DEBT SOLD UNDER THIS SUBSECTION: 23
(I) MUST BE FOR HOSPITAL SERVICES PROVIDED AT LEAST 2 24
YEARS BEFORE THE DAT E OF THE SALE; 25
(II) MAY NOT BE EXPECTED T O YIELD ADDITIONAL 26
REIMBURSEMENTS FROM A THIRD–PARTY PAYOR; 27
(III) MAY NOT BE SUBJECT TO AN OPEN APPEAL WITH AN 28
INSURANCE COMPANY ; AND 29
(IV) MUST BE FOR AN INDIVI DUAL WHOSE FAMILY IN COME IS AT 30
OR BELOW 500% OF THE FEDERAL POVER TY LEVEL OR WHO HAS MEDICAL DEBT 31
EXCEEDING 5% OF THE INDIVIDUAL ’S FAMILY INCOME , AS DETERMINED BY THE 32
GOVERNMENTAL UNIT OR, CONTRACTOR , OR NONPROFIT ORGANIZ ATION 33
PURCHASING THE DEBT . 34
6 HOUSE BILL 765
(3) DEBT SOLD UNDER THIS SUBSECTION MAY BE SO LD WITH A 1
REDUCTION OF COMMISSION CHARGES . 2
(4) THE COMMISSION SHALL TREA T THE AMOUNT O F PAYMENTS TO 3
HOSPITALS UNDER THIS SUBSECTION AS AN OFF SET TO UNCOMPENSATED CARE 4
AMOUNTS REPORTED BY HOSPITALS. 5
(5) THE PURCHASER OF THE DEBT SHALL: 6
(I) NOTIFY THE PATIENT TH AT THE DEBT HAS BEEN 7
CANCELED; AND 8
(II) IF THE HOSPITAL OBTAI NED A JUDGMENT AGAINST THE 9
PATIENT OR REPORTED ADVERSE INFORMATION TO A CONSUMER REPORT ING 10
AGENCY ABOUT THE PAT IENT, SEEK TO VACATE THE J UDGMENT OR STRIKE TH E 11
ADVERSE INFORMATION . 12
[(m)] (N) The Commission shall review each hospital’s implementation of and 13
compliance with the hospital’s policies and the requirements of this section. 14
[(n)] (O) (1) On or before February 1 each year, beginning in 2023, the 15
Commission shall compile the information required under subsection (a) of this section and 16
prepare a medical debt collection report based on the compiled information. 17
(2) The report required under paragraph (1) of this subsection shall be: 18
(i) Made available to the public free of charge; and 19
(ii) Submitted to the Senate Finance Committee and the H ouse 20
Health and Government Operations Committee in accordance with § 2–1257 of the State 21
Government Article. 22
19–219. 23
(a) The Commission may review the costs, and rates, quality, and efficiency of 24
facility services, and make any investigation that the Commission considers necessary to 25
assure each purchaser of health care facility services that: 26
(3) [The] EXCEPT AS PROVIDED IN § 19–214.2(M) OF THIS SUBTITLE , 27
THE rates are set equitably among all purchasers or classes of purchasers without undue 28
discrimination or preference. 29
SECTION 2. AND BE IT FURTHER ENACTED, That this Act is an emergency 30
measure, is necessary for the immediate preservation of the public health or safety, has 31
been passed by a yea and nay vote supported by three–fifths of all the members elected to 32
each of the two Houses of the General Assembly, and shall take effect from the date it is 33 HOUSE BILL 765 7
enacted July 1, 2025. It shall remain effective through December 31, 2027, and, at the end 1
of December 31, 2027 for a period of 3 years and, at the end of June 30, 2028, this Act, with 2
no further action required by the General Assembly, shall be abrogated and of no further 3
force and effect. 4
Approved:
________________________________________________________________________________
Governor.
________________________________________________________________________________
Speaker of the House of Delegates.
________________________________________________________________________________
President of the Senate.