Minnesota House Bill HF1646

Minnesota 2025-2026 Regular Session

• Introduced: 2/27/25
• Refer: 2/27/25

Caption

Definition of debt buyer modified, Undue Medical Debt grant funding provided, reports required, and money appropriated.

Impact

One of the key components of HF1646 is the appropriation of $5 million from the general fund to provide a grant to the Undue Medical Debt initiative. This funding is designated for relieving the medical debts of eligible residents who are unable to pay their medical bills even after reasonable collection efforts by hospital providers. This initiative demonstrates a proactive approach by the state to address the growing crisis of medical debt, which often leads to severe financial distress and impacts individuals' overall well-being. The proposed funding is a one-time allocation, which will remain available until June 30, 2028.

Summary

House File 1646 is a bill aimed at modifying state regulations surrounding debt collection, particularly focusing on medical debt. The bill establishes a revised definition of 'debt buyer', specifically targeting businesses involved in purchasing charged-off medical accounts for collection. By clarifying the definition, HF1646 seeks to delineate between for-profit debt buyers and nonprofit organizations that acquire such debts for charitable purposes. This distinction is crucial in regulating how medical debts are managed and collected within the state, thereby offering protections to vulnerable residents burdened by medical expenses.

Contention

The bill generates a dialogue around consumer protection and the responsibility of debt collection practices in the healthcare sector. Proponents argue that the bill provides essential relief to those who find themselves in financial difficulty due to medical debt, which can be crippling for many families. However, there may be contention regarding the bill's fiscal implications and whether such an appropriation adequately addresses the underlying issues related to healthcare costs in Minnesota. Some stakeholders may concern whether such measures might lead to increased expectations from residents regarding debt relief or if additional measures are necessary to comprehensively tackle high medical expenses in the state.