North Carolina 2025-2026 Regular Session

North Carolina Senate Bill S672 Compare Versions

Version 1 (Old)

Version 2 (New)

Old	New		Differences
1	1		GENERAL ASSEMBLY OF NORTH CAROLINA
2	2		SESSION 2025
3		-	S 1
4		-	SENATE BILL 672
	3	+	S D
	4	+	SENATE BILL DRS45310-NH-20
	5	+
5	6
6	7
7	8		Short Title: Protect North Carolinians from Medical Debt. (Public)
8	9		Sponsors: Senator Burgin (Primary Sponsor).
9		-	Referred to: ~~Rules and Operations of the Senate~~
10		-	~~March 26, 2025~~
11		-	~~S672 -v-1~~
	10	+	Referred to:
	11	+
	12	+	DRS45310 -NH-20
12	13		A BILL TO BE ENTITLED 1
13	14		AN ACT TO ADOPT THE PRO -FAMILY, PRO-CONSUMER MEDICAL DEBT 2
14	15		PROTECTION ACT TO LIMIT THE ABILITY OF LARGE MEDICAL FACILITIES TO 3
15	16		CHARGE UNREASONABLE INTEREST RATES AND EMPLOY UNFAIR TACTICS IN 4
16	17		DEBT COLLECTION. 5
17	18		The General Assembly of North Carolina enacts: 6
18	19		7
19	20		PART I. MEDICAL DEBT PROTECTION ACT 8
20	21		SECTION 1. Chapter 131E of the General Statutes is amended by adding a new 9
21	22		Article to read: 10
22	23		"Article 11C. 11
23	24		"Medical Debt Protection Act. 12
24	25		"§ 131E-214.21. Short title and purpose. 13
25	26		This Article may be cited as the "Medical Debt Protection Act." The purpose of this Article 14
26	27		is to reduce burdensome medical debt and to protect patients in their dealings with medical 15
27	28		creditors, medical debt buyers, and medical debt collectors with respect to such debt. This Article 16
28	29		is a consumer protection statute and shall be liberally and remedially construed to effectuate its 17
29	30		purposes. 18
30	31		"§ 131E-214.22. Definitions. 19
31	32		The following definitions apply in this Article: 20
32	33		(1) Consumer. – A natural person who has incurred a debt or alleged debt for 21
33	34		primarily personal, family, or household purposes. 22
34	35		(2) Consumer reporting agency. – Any person, which, for monetary fees, dues, or 23
35	36		on a cooperative nonprofit basis, regularly engages in whole or in part in the 24
36	37		practice of assembling or evaluating consumer credit information or other 25
37	38		information on consumers for the purpose of furnishing consumer reports to 26
38	39		third parties. 27
39	40		(3) External review. – Review of an adverse benefit determination, including a 28
40	41		final internal adverse benefit determination, conducted pursuant to an 29
41	42		applicable State external review process as described in Part 4 of Article 50 30
42	43		of Chapter 58 of the General Statutes, a federal external review process as 31
43	44		described in 42 U.S.C. § 300gg-19, a review pursuant to 29 U.S.C. § 1133, a 32
44	45		Medicare appeals process, a Medicaid appeals process, or another applicable 33
45	46		appeals process. 34
46	47		(4) Extraordinary collection action. – An extraordinary collection action includes 35
47		-	any of the following: 36 General Assembly Of North Carolina Session 2025
48		-	Page 2 Senate Bill 672-First Edition
	48	+	any of the following: 36
	49	+	FILED SENATE
	50	+	Mar 25, 2025
	51	+	S.B. 672
	52	+	PRINCIPAL CLERK General Assembly Of North Carolina Session 2025
	53	+	Page 2 DRS45310-NH-20
49	54		a. Selling an individual's debt to another party, except if prior to the sale, 1
50	55		the medical creditor enters into a legally binding written agreement 2
51	56		with the medical debt buyer which includes the following provisions: 3
52	57		1. The medical debt buyer or collector is prohibited from 4
53	58		engaging in any extraordinary collection actions to obtain 5
54	59		payment for the care. 6
55	60		2. The medical debt buyer is prohibited from charging interest on 7
56	61		the debt in excess of that described in G.S. 131E-214.35. 8
57	62		3. The debt is returnable to or recallable by the medical creditor 9
58	63		upon a determination by the medical creditor or medical debt 10
59	64		buyer that the individual is eligible for financial assistance. 11
60	65		4. If the individual is determined to be eligible for financial 12
61	66		assistance for emergency or medically necessary care and the 13
62	67		debt is not returned to or recalled by the medical creditor, the 14
63	68		medical debt buyer is required to adhere to procedures which 15
64	69		ensure that the individual does not pay, and has no obligation 16
65	70		to pay, the medical debt buyer and the medical creditor 17
66	71		together more than he or she is personally responsible for 18
67	72		paying in compliance with this Article. Such procedures shall 19
68	73		be specified in any agreement between a medical creditor and 20
69	74		a medical debt buyer. 21
70	75		b. Taking a confession of judgment or allowing a borrower to execute a 22
71	76		power of attorney to confess a judgment. 23
72	77		c. Actions that require a legal or judicial process, including, but not 24
73	78		limited to: 25
74	79		1. Attaching or seizing an individual's bank account or any other 26
75	80		personal property. 27
76	81		2. Commencing a civil action or arbitration against an individual. 28
77	82		(5) Gross charges. – A covered health care provider's full, established price for 29
78	83		health care services that the covered health care provider charges uninsured 30
79	84		patients before applying any contractual allowances, discounts, or deductions. 31
80	85		(6) Health care services. – Services for the diagnosis, prevention, treatment, cure, 32
81	86		or relief of a physical, dental, behavioral, substance use disorder or mental 33
82	87		health condition, illness, injury, or disease. These services include, but are not 34
83	88		limited to, any procedures, products, devices, or medications. 35
84	89		(7) Household income. – Income calculated by using the methods used to 36
85	90		calculate Medicaid eligibility, as set forth in 42 C.F.R. 435.603. 37
86	91		(8) Internal review or internal appeal. – Review by a health insurance plan or other 38
87	92		insurer of an adverse benefit determination. 39
88	93		(9) Large health care facility. – Includes any of the following entities: 40
89	94		a. Any hospital licensed under this Chapter or Chapter 122C of the 41
90	95		General Statutes, whether a nonprofit subject to 26 U.S.C. § 501(c)(3), 42
91	96		a hospital owned by a county, municipality, the State, or a for-profit 43
92	97		entity. 44
93	98		b. Any outpatient clinic or facility affiliated with a hospital or operating 45
94	99		under the license of a hospital described in sub-subdivision a. of this 46
95	100		subdivision. 47
96	101		c. Any ambulatory surgical center licensed under this Chapter. 48
97	102		d. Any practice which provides outpatient medical, behavioral, optical, 49
98	103		radiology, laboratory, dental, or other health care services with 50
99	104		revenues of at least twenty million dollars ($20,000,000) annually and 51 General Assembly Of North Carolina Session 2025
100		-	~~Senate Bill 672-First Edition~~ Page 3
	105	+	DRS45310-NH-20 Page 3
101	106		is licensed under this Chapter or has medical providers performing 1
102	107		health care services pursuant to a license issued under Chapter 90 of 2
103	108		the General Statutes. 3
104	109		e. Any licensed health care professional who provides health care 4
105	110		services in one or more of the settings listed in sub-subdivisions a. 5
106	111		through d. of this subdivision and bills patients independently. 6
107	112		(10) Medical creditor. – Any entity that provides health care services and to whom 7
108	113		the consumer owes money for health care services, or the entity that provided 8
109	114		health care services and to whom the consumer previously owed money if the 9
110	115		medical debt has been purchased by one or more debt buyers. 10
111	116		(11) Medical debt. – A debt arising from the receipt of health care services. 11
112	117		(12) Medical debt buyer. – A person or entity that is engaged in the business of 12
113	118		purchasing medical debts for collection purposes, whether it collects the debt 13
114	119		itself or hires a third party for collection or an attorney-at-law for litigation in 14
115	120		order or other collection activity to collect such debt. 15
116	121		(13) Medical debt collector. – Any person that regularly collects or attempts to 16
117	122		collect, directly or indirectly, medical debts originally owed or due or asserted 17
118	123		to be owed or due another. A medical debt buyer is considered to be a medical 18
119	124		debt collector for all purposes. 19
120	125		(14) Medical debt mitigation policy (MDMP). – A financial assistance policy 20
121	126		which shall be written in accordance with this Article. 21
122	127		(15) Patient. – The person who received health care services and, for the purposes 22
123	128		of this Article, as context requires, the person legally obligated to pay for the 23
124	129		provision of the health care services. 24
125	130		"§ 131E-214.23. Medical debt mitigation policy for large health care facilities. 25
126	131		(a) All large health care facilities are required to develop a written MDMP that complies 26
127	132		with this Article and any implementing rules. This requirement shall apply whether or not the 27
128	133		large health care facility is required to develop a financial assistance policy under 26 U.S.C. § 28
129	134		501(r)(4) and implementing regulations. 29
130	135		(b) The MDMP must, at a minimum, include the following: 30
131	136		(1) A written financial assistance policy that applies to all emergency and other 31
132	137		medically necessary health care services offered by the covered health care 32
133	138		provider. 33
134	139		(2) The basis for calculating amounts charged to patients. 34
135	140		(3) A plain language summary of the financial assistance policy, which shall not 35
136	141		exceed two pages in length. 36
137	142		(4) The eligibility criteria for financial assistance including when such assistance 37
138	143		includes free or discounted care. 38
139	144		(5) A summary of the type of financial assistance that is available as set forth in 39
140	145		this Article. 40
141	146		(6) The method and application process that patients are to use to apply for 41
142	147		financial assistance. 42
143	148		(7) The information and documentation the large health care facility may require 43
144	149		an individual to provide as part of the application. 44
145	150		(8) The reasonable steps that the provider will take to determine whether a patient 45
146	151		is eligible for financial assistance. 46
147	152		(9) The billing and collections policy, including the actions that may be taken in 47
148	153		the event of nonpayment, which shall comply with all applicable parts of this 48
149	154		Article and other applicable municipal, State, or federal laws. 49
150	155		(10) Information about available payment plans for patients, including available 50
151	156		time periods for repayment and caps on payment amount. 51 General Assembly Of North Carolina Session 2025
152		-	Page 4 ~~Senate Bill 672-First Edition~~
	157	+	Page 4 DRS45310-NH-20
153	158		(11) Measures the facility will take to widely publicize the policy within the 1
154	159		community to be served by the facility in accordance with G.S. 131E-214.27. 2
155	160		(c) The MDMP must be approved by the owners or governing body of a health care 3
156	161		provider and shall be reviewed by the owners or governing board annually. 4
157	162		"§ 131E-214.24. Implementation of the medical debt mitigation policy. 5
158	163		(a) In addition to any other actions required by applicable municipal, State, or federal 6
159	164		law, large health care facilities must take the following steps before seeking payment for any 7
160	165		emergency or medically necessary care: 8
161	166		(1) Determine whether the patient has health insurance. 9
162	167		(2) If the patient is uninsured, offer to screen the patient for public or private 10
163	168		insurance eligibility and offer assistance if the patient chooses to apply for 11
164	169		public or private insurance, however, a patient's refusal to be screened shall 12
165	170		not be grounds for denying financial assistance. 13
166	171		(3) Offer to screen the patient for other public programs which may assist with 14
167	172		health care costs; however, a patient's refusal to be screened shall not be 15
168	173		grounds for denying financial assistance. 16
169	174		(4) If available, use information in the possession of the large health care facility 17
170	175		to determine if the patient is qualified for free or discounted care as set forth 18
171	176		in G.S. 131E-214.25. 19
172	177		(5) Determine whether the patient is eligible for assistance under the large health 20
173	178		care facility's Presumptive Eligibility Policy adopt pursuant to 21
174	179		G.S. 131-214.26(b). 22
175	180		(6) If a patient submits an application or eligibility documentation pursuant to 23
176	181		G.S. 131E-214.26(c), the large health care facility shall issue a determination 24
177	182		of eligibility on the application or eligibility documentation within 14 days of 25
178	183		receipt of the application or eligibility documentation. The facility shall 26
179	184		suspend all billing and collection actions while an eligibility determination is 27
180	185		pending. 28
181	186		(7) A large health care facility shall provide a patient all of the following 29
182	187		notifications: 30
183	188		a. When an application for financial assistance is received. 31
184	189		b. During review of the application, if the application is found to be 32
185	190		missing any components or needs to be updated. This notice shall 33
186	191		include details about the information the patient needs to provide to 34
187	192		complete the application. 35
188	193		c. If the application is denied, a notice of the denial including the basis 36
189	194		for the denial and information on how to appeal the decision. 37
190	195		d. If the application is approved, notice of the approval including a 38
191	196		detailed explanation of the costs charged to the patient, how the 39
192	197		financial aid policy has been applied to the costs charged to the patient, 40
193	198		and a detailed explanation of what the patient does or will owe. This 41
194	199		notice shall also explain how to apply for additional financial 42
195	200		assistance for any remaining balance. 43
196	201		(c) A large health care facility shall accept and consider a patient's application for 44
197	202		financial assistance if it is submitted within one year of the date of the first bill after the provision 45
198	203		of the health care services. However, if the patient is the subject of collection activity by the 46
199	204		facility or a medical debt collector, including a lawsuit to collect a medical debt, and the patient 47
200	205		submits, or updates by providing eligibility documentation for, an application for financial 48
201	206		assistance, the large health care facility shall accept and process the application at any time. If 49
202	207		the patient submits a financial assistance application to a medical debt collector, the medical debt 50
203	208		collector shall forward the application to the large health care facility within two business days 51 General Assembly Of North Carolina Session 2025
204		-	~~Senate Bill 672-First Edition~~ Page 5
	209	+	DRS45310-NH-20 Page 5
205	210		and shall cease collection activity until notified by the large health care facility of the outcome 1
206	211		of the application and any debt forgiven or new repayment terms. 2
207	212		(d) For a patient who has been found to be eligible for financial assistance, no initial 3
208	213		payment on a monthly payment plan shall be due within the first 90 days after the health care 4
209	214		services were provided. 5
210	215		(e) The large health care facility shall create an appeals process under which it will 6
211	216		evaluate denials of financial assistance upon request of a patient. Any denial of financial 7
212	217		assistance shall inform a patient of the right to appeal the denial. 8
213	218		"§ 131E-214.25. Eligibility for medical debt mitigation policy financial assistance. 9
214	219		(a) A large health care facility's financial assistance policy adopted as required by this 10
215	220		Article shall be available, at a minimum, to any patient meeting the eligibility criteria in this 11
216	221		section. 12
217	222		(b) The following patients shall qualify for financial assistance under the MDMP in 13
218	223		accordance with the following terms, which applies to any charges for health care services that 14
219	224		are not covered by insurance and would otherwise be billed to the patient: 15
220	225		(1) Patients with household income of zero percent (0%) to three hundred percent 16
221	226		(300%) of the federal poverty level shall receive free care. 17
222	227		(2) Patients with household income of more than three hundred percent (300%) 18
223	228		up to four hundred percent (400%) of the federal poverty level shall be 19
224	229		charged no more than an amount calculated in the following manner: 20
225	230		a. Recalculate the patient's bill using the Medicare reimbursement rate 21
226	231		applicable on the dates of service. 22
227	232		b. The patient shall be charged no more than twenty-five percent (25%) 23
228	233		of the recalculated bill. 24
229	234		(3) Patients with household income of more than four hundred percent (400%) up 25
230	235		to six hundred percent (600%) of the federal poverty level shall receive the 26
231	236		same discount listed in subdivision (2) of subsection (b) of this section if the 27
232	237		patient or the patient's household has incurred medical expenses during the 28
233	238		previous 12 months which in total exceed tfive percent (5%) of the 29
234	239		household's income. For purposes of this section, medical expenses includes 30
235	240		all bills for medically necessary health care services received by a household 31
236	241		member during the previous 12 months, including the bill the large health care 32
237	242		facility is currently seeking payment on. 33
238	243		(4) In addition to other financial assistance provided under this Article, no patient 34
239	244		with household income at or below four hundred percent (400%) of the federal 35
240	245		poverty level shall be required to pay more than two thousand three hundred 36
241	246		dollars ($2,300) in cumulative medical bills to large health care facilities in 37
242	247		any 12 month period. Upon patient request and documentation, any health care 38
243	248		services that have been delivered by one or more large health care facilities 39
244	249		after the two thousand three hundred dollar ($2,300) limit has been met must 40
245	250		be provided as free care. A large health care facility may require a patient to 41
246	251		provide proof of payment showing the payment cap has been reached except 42
247	252		for payments made to that large health care facility which should have record 43
248	253		of the payment. 44
249	254		(c) If a patient is approved for financial assistance, the patient shall remain qualified for 45
250	255		the same level of financial assistance for at least one year from the date the financial assistance 46
251	256		is approved, with the opportunity to renew. 47
252	257		"§ 131E-214.26 Determining eligibility for medical debt mitigation policy financial 48
253	258		assistance. 49
254	259		(a) As part of a large health care facility's MDMP, the facility shall adopt a process to 50
255	260		screen for presumptive eligibility for financial assistance and establish a process for determining 51 General Assembly Of North Carolina Session 2025
256		-	Page 6 ~~Senate Bill 672-First Edition~~
	261	+	Page 6 DRS45310-NH-20
257	262		non-presumptive eligibility. The facility shall not issue a bill to a patient until the patient has 1
258	263		been screened for presumptive eligibility and notified if found presumptively eligible. 2
259	264		(b) The presumptive eligibility screening policy shall comply with all of the following: 3
260	265		(1) Shall not require a patient to provide documentation or other verification of 4
261	266		meeting presumptive eligibility criteria. 5
262	267		(2) Shall require patients to be screened for presumptive eligibility prior to or at 6
263	268		check-in for non-emergency services and as soon as reasonably possible and 7
264	269		prior to discharge, if feasible, for emergency services. 8
265	270		(3) Shall allow patients to attest to their qualifications for Medicaid, with an 9
266	271		understanding that the patient will not be financially penalized for 10
267	272		misreporting qualifications if the report was made in good faith and the patient 11
268	273		is later determined to be ineligible. 12
269	274		(4) Shall deem a patient presumptively eligible for financial assistance if the 13
270	275		patient meets any one or more of the following criteria: 14
271	276		a. Experiencing homelessness. 15
272	277		b. Is mentally incapacitated with no legal guardian to act on their behalf. 16
273	278		c. The patient or someone in the patient's household is enrolled in 17
274	279		Medicaid. 18
275	280		d. The patient or someone in the patient's household is enrolled in any 19
276	281		means-tested public assistance program, including Supplemental 20
277	282		Security Income, Medicare Low Income Subsidy, Low Income Energy 21
278	283		Assistance Program, Temporary Assistance to Needy Families, 22
279	284		Women, Infants and Children Nutrition Program, or Supplemental 23
280	285		Nutrition Assistance Program. 24
281	286		e. The patient is enrolled in an organized community-based program 25
282	287		providing access to medical care that assesses and documents limited 26
283	288		low-income financial status as criteria. 27
284	289		f. By income. A large health care facility may use third-party software 28
285	290		tools or services to determine patient eligibility for income-based 29
286	291		presumptive eligibility only if they are unable to determine a patient's 30
287	292		eligibility through other means. If the facility is unable to determine a 31
288	293		patient's eligibility through other means, it may choose to use a 32
289	294		consumer report, as defined in section 603(a) of the Fair Credit 33
290	295		Reporting Act, 15 U.S.C.1681a(d), or any score or rating based on a 34
291	296		consumer report information. Before obtaining any consumer 35
292	297		information to determine income eligibility, a facility must obtain 36
293	298		consent for the credit check from the patient. The patient's consent 37
294	299		must be given in writing on a standalone document and shall be 38
295	300		effective for no more than 30 days. 39
296	301		(5) A large health care facility may grant financial assistance based on a 40
297	302		determination of presumptive eligibility relying on any information obtained 41
298	303		by the facility or in the facility's possession, but shall not use that information 42
299	304		to deny financial assistance. 43
300	305		(c) If a patient is found to not be presumptively eligible for financial assistance after 44
301	306		being screened in accordance with subsection (b) of this section, then the large health care facility 45
302	307		must provide a process for patients to apply for financial assistance that complies with all of the 46
303	308		following: 47
304	309		(1) Allows patients to apply by phone, online, by mail, or in-person. 48
305	310		(2) May require patients to provide proof of income. Patients may prove income 49
306	311		by submitting any of the following: 50
307	312		a. Most recent tax return. 51 General Assembly Of North Carolina Session 2025
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	313	+	DRS45310-NH-20 Page 7
309	314		b. A pay stub. 1
310	315		c. Documentation of public assistance or participation in any 2
311	316		means-tested program, including those listed in sub-subdivision (4) of 3
312	317		subsection (b) of this section. 4
313	318		d. Any documentation of household income which the Office of the State 5
314	319		Treasurer has identified as a valid form of documentation for the 6
315	320		purposes of this Article. 7
316	321		(3) A large health care facility may grant financial assistance notwithstanding a 8
317	322		patient's failure to provide proof of income and may rely on, but not require 9
318	323		other evidence of eligibility. 10
319	324		"§ 131E-214.27 Medical debt mitigation policy public education and information. 11
320	325		(a) A large health care facility must publicize its MDMP widely by: 12
321	326		(1) Making the policy and the financial assistance application form easily 13
322	327		accessible online, through the large health care facility's website and through 14
323	328		any patient portal or other online communication portal used by patients of 15
324	329		the health care provider. As part of the information available online related to 16
325	330		the MDMP, the large health care facility shall also identify prohibited 17
326	331		collection actions and unlawful debt collection practices that the medical 18
327	332		creditor or medical debt collector cannot take under state and federal law, 19
328	333		including causing an individual's arrest, holding a spouse liable for an 20
329	334		individual's medical debt, foreclosing on an individual's real property, and 21
330	335		garnishing wages or state income tax refunds and shall provide information 22
331	336		about filing a complaint with the Attorney General if the patient's rights are 23
332	337		violated. 24
333	338		(2) In addition to any other requirements in this Article, making paper copies of 25
334	339		the MDMP and application form available upon request and without charge, 26
335	340		both by mail and in the large health care facility's office. For hospitals, copies 27
336	341		should be available, at a minimum, in the emergency room, if any, billing and 28
337	342		financial assistance application areas, and admissions areas. 29
338	343		(3) Notifying and informing members of the community served by the large 30
339	344		health care facility about the MDMP in a manner reasonably calculated to 31
340	345		reach those members who are most likely to require financial assistance with 32
341	346		such efforts commensurate to the size and income of the provider. 33
342	347		(4) Notifying and informing individuals who receive care from the large health 34
343	348		care facility about the MDMP by: 35
344	349		a. Offering a paper copy of the MDMP to patients as part of the patient's 36
345	350		first visit, or in the case of a hospital facility, during the intake and 37
346	351		discharge process. 38
347	352		b. Including a conspicuous written notice on billing statements, whether 39
348	353		sent by the large health care facility or a medical debt collector, that 40
349	354		notifies and informs recipients about the availability of financial 41
350	355		assistance and payment plans and includes the telephone number of 42
351	356		the large health care facility's office or department that can provide 43
352	357		information about the financial assistance policy and application 44
353	358		process and the direct website address where copies of the MDMP and 45
354	359		application may be obtained. 46
355	360		c. Setting up conspicuous public displays or other measures reasonably 47
356	361		calculated to attract patients' attention that notify and inform patients 48
357	362		about the MDMP in public locations in the large health care facility's 49
358	363		office. For hospitals, displays should be posted in the emergency room, 50 General Assembly Of North Carolina Session 2025
359		-	Page 8 ~~Senate Bill 672-First Edition~~
	364	+	Page 8 DRS45310-NH-20
360	365		if any, billing and financial assistance application areas, and 1
361	366		admissions areas, at a minimum. 2
362	367		(b) In all written attempts by a medical creditor or medical debt collector to collect a 3
363	368		medical debt for health care services provided by a large health care facility, the patient must be 4
364	369		informed of any financial assistance policy available through the large health care facility and 5
365	370		given the same information about prohibited debt collection practices as required under 6
366	371		subdivision (a)(1) of this section. 7
367	372		(c) In all oral attempts by a medical creditor or debt collector to collect a medical debt 8
368	373		for health care services provided by a large health care facility, the patient must be informed of 9
369	374		any financial assistance policy available through the large health care facility and the website 10
370	375		address where the information on prohibited debt collection practices required under subdivision 11
371	376		(a)(1) of this section, and given the same information about prohibited debt collection practices 12
372	377		as required under subdivision (a)(1) of this section, as well as the phone number and website 13
373	378		address where such information can be accessed. 14
374	379		(d) Medical creditors and medical debt collectors shall notify all patients about the risks 15
375	380		of paying for medical services with a credit card, including at the point of transaction when a 16
376	381		patient attempts to pay a medical creditor or debt collector with a credit card. The notification 17
377	382		must inform the patient that by using a credit card to pay for medical services, the patient may 18
378	383		be forgoing state and federal protections regarding medical debt and financial assistance policies. 19
379	384		Before accepting a credit card payment from a patient, a medical creditor or medical debt 20
380	385		collector shall obtain a signed, written waiver from the patient acknowledging that the patient 21
381	386		has received the notice required by this subsection. 22
382	387		(e) A large healthcare provider may not require a credit card pre-authorization or for a 23
383	388		patient to have a credit card on file prior to providing emergency or medically necessary services 24
384	389		to a patient. 25
385	390		"§ 131E-214.28. Medical debt mitigation policy language access. 26
386	391		(a) Notices sent by large health care facilities shall include the following language: "This 27
387	392		document contains important information about financial assistance for your bill. Contact [insert 28
388	393		name and phone number of large health care facility] for free translation assistance," translated 29
389	394		in the 15 languages most frequently spoken by limited English proficient households as 30
390	395		determined by U.S. Census Bureau data in the large health care facility's service area. This 31
391	396		language is required to be included on all of the following: 32
392	397		(1) The large health care facility's MDMP. 33
393	398		(2) Financial assistance application forms, documents, and notices required under 34
394	399		G.S. 131E-214.24. 35
395	400		(3) Any document seeking payment from a patient, including bills, invoices, and 36
396	401		collections communications. 37
397	402		(4) Any document or notice related to a credit card payment under 38
398	403		G.S. 131E-214.27. 39
399	404		(5) Any document or notice related to a facility fee, including those described in 40
400	405		G.S. 131E-274. 41
401	406		(b) A large health care facility must accommodate all significant populations that have 42
402	407		limited English proficiency by translating the MDMP, application form, and related documents 43
403	408		into the primary languages spoken by such populations. A large health care facility will satisfy 44
404	409		this translation requirement if it makes available translations of these documents in the language 45
405	410		spoken by each limited English proficiency language group that constitutes the lesser of 1,000 46
406	411		individuals or five percent (5%) of the community served by the large health care facility or the 47
407	412		population likely to be affected or encountered by the large health care facility. A large health 48
408	413		care facility may determine the percentage or number of limited English proficiency individuals 49
409	414		in the large health care facility's community or likely to be affected or encountered by the hospital 50
410	415		facility. 51 General Assembly Of North Carolina Session 2025
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	416	+	DRS45310-NH-20 Page 9
412	417		(c) A large health care facility must accommodate any patient with limited English 1
413	418		proficiency, who is part of a population which falls below the numerical thresholds established 2
414	419		in subsection (b) of this section, by providing oral interpretation services to the patient upon 3
415	420		request and at no cost to the patient to explain the MDMP and its application. 4
416	421		(d) A large health care facility must accommodate any patient with limited English 5
417	422		proficiency to answer questions from the patient regarding the MDMP, the application form, any 6
418	423		written determination of eligibility, any communication regarding financial assistance from the 7
419	424		large health care facility, and any notice sent to patients. A large health care facility may 8
420	425		accommodate these patients by providing oral interpretation services to the patient upon request 9
421	426		and at no cost to the patient. 10
422	427		"§ 131E-214.29. Prohibited acts in collecting medical debt. 11
423	428		(a) The following prohibited collection actions may not be used by any medical creditor 12
424	429		or medical debt collector to collect debts owed for health care services: 13
425	430		(1) Causing an individual's arrest. 14
426	431		(2) Causing an individual to be held in civil contempt or imprisoned under 15
427	432		G.S. 5A-21 or G.S. 1-302 if the only reason supporting the contempt is the 16
428	433		debtor's failure to pay a judgment for medical debt. 17
429	434		(3) Foreclosing on an individual's real property. 18
430	435		(4) Placing a lien on an individual's real property or engaging in any action that 19
431	436		would result in a lien being placed on an individual's real property. 20
432	437		(5) Acquiring a security interest or lien in the individual's real property, by 21
433	438		agreement or otherwise. 22
434	439		(6) Garnishing wages or State income tax refunds. 23
435	440		(b) No medical creditor or medical debt collector may communicate with or report any 24
436	441		information to any consumer reporting agency regarding a consumer's medical debt, unless the 25
437	442		communication is made to resolve an erroneous reporting. 26
438	443		(c) Any medical debt or portion of medical debt that is reported to a consumer reporting 27
439	444		agency in violation of this section shall be void. 28
440	445		(d) Nothing in this Article shall be construed as exempting a medical creditor or medical 29
441	446		debt collector from the provisions of Chapter 75 or Chapter 58 of the General Statutes, as those 30
442	447		Chapters are applicable. 31
443	448		"§ 131E-214.30. Limitations on extraordinary collection actions. 32
444	449		(a) No medical creditor or medical debt collector shall engage in any permissible 33
445	450		extraordinary collection actions until 180 days after the first bill for a medical debt has been sent. 34
446	451		(b) If a patient is eligible for financial assistance under the large health care facility's 35
447	452		MDMP, a medical creditor or medical debt collector shall not engage in any extraordinary 36
448	453		collection actions against the eligible patient. 37
449	454		(c) Medical creditors and medical debt collectors shall not engage in any extraordinary 38
450	455		collection actions during a state or federally declared state of emergency or a public health 39
451	456		emergency in the area where the patient lives. 40
452	457		(d) At least 30 days before taking any extraordinary collection actions, a medical creditor 41
453	458		or medical debt collector must provide to the patient a notice containing the following: 42
454	459		(1) In the case of large health care facilities and medical debt collectors collecting 43
455	460		debt for health care services provided by such facilities, stating that financial 44
456	461		assistance and payment plans are available for eligible individuals and 45
457	462		providing a plain-language summary of the MDMP. 46
458	463		(2) Identifying the extraordinary collection actions that will be initiated in order 47
459	464		to obtain payment. 48
460	465		(3) Providing a deadline after which such extraordinary collection actions will be 49
461	466		initiated, which date is no earlier than 30 days after the date of the notice. 50 General Assembly Of North Carolina Session 2025
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	467	+	Page 10 DRS45310-NH-20
463	468		(4) Identifying unlawful debt collection actions and practices that the medical 1
464	469		creditor or debt collector are barred from taking or conducting under state and 2
465	470		federal law, including causing an individual's arrest, holding a spouse liable 3
466	471		for an individual's medical debt, foreclosing on an individual's property, and 4
467	472		garnishing wages or state income tax refunds and shall provide information 5
468	473		about filing a complaint with the Attorney General if a patient's rights are 6
469	474		violated. 7
470	475		(e) A large health care facility or a medical debt collector collecting debt for health care 8
471	476		services provided by such a facility shall not use any extraordinary collection actions unless these 9
472	477		actions are described in the large health care facility's billing and collections policy. 10
473	478		(f) If a large health care facility or a medical debt collector collecting debt for health care 11
474	479		services provided by such a facility bills or initiates collection activities and the patient is later 12
475	480		found eligible for financial assistance, within 90 days from the date eligibility is determined the 13
476	481		large health care facility or medical debt collector shall reverse any extraordinary collection 14
477	482		actions, including dismissing or vacating any collection lawsuits over the medical debt and 15
478	483		returning any funds or property taken as part of judgment enforcement. 16
479	484		(g) If the patient has paid any part of the medical debt or any of the patient's funds have 17
480	485		been seized or levied in excess of the amount that the patient owes after application of financial 18
481	486		assistance, within 90 days from the date eligibility is determined the large health care facility or 19
482	487		medical debt collector shall refund any excess amount to the patient with interest. Interest shall 20
483	488		accumulate beginning the day eligibility is determined. 21
484	489		"§ 131E-214.31. Price information. 22
485	490		(a) All large health care facilities must post price information on their internet websites. 23
486	491		This information must be accessible via a link from the website's homepage and at a minimum 24
487	492		must include the following: 25
488	493		(1) A list of gross charges for all health care services. 26
489	494		(2) Next to the relevant gross charge, a list of the amounts that Medicare would 27
490	495		reimburse for the health care service. 28
491	496		(3) Next to the relevant gross charge, the amount a patient would be required to 29
492	497		pay under each level of financial assistance. 30
493	498		(4) Plain-language titles or descriptions of health care services that can be 31
494	499		understood by the average patient. 32
495	500		(b) A large health care facility that is not in compliance with this section on the date that 33
496	501		items or services were provided to a patient shall not initiate or pursue a collection action against 34
497	502		the patient for a debt owed for the items or services. 35
498	503		"§ 131E-214.32. Liability for medical debt. 36
499	504		No spouse or other person shall be liable for the medical debt or nursing home debt of any 37
500	505		other person age 18 or older, or any other damages related to the collection of the patient's bill. 38
501	506		A person may not voluntarily consent to assume liability, and any such agreement shall be 39
502	507		unenforceable. 40
503	508		"§ 131E-214.33. Verification. 41
504	509		Before requesting payment from a patient, or within 60 days of a patient's written or oral 42
505	510		request, a medical creditor or medical debt collector shall provide a patient with an itemized bill 43
506	511		at no cost to the patient. The itemized bill shall state: 44
507	512		(1) The name and address of the medical creditor. 45
508	513		(2) The dates of service. 46
509	514		(3) The dates the medical debts were incurred, if different from the dates of 47
510	515		service. 48
511	516		(4) A detailed list of the specific health care services provided to the patient. 49
512	517		(5) A list of all health care professionals who treated the patient. 50
513	518		(6) The amount of principal for any medical debts incurred. 51 General Assembly Of North Carolina Session 2025
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	519	+	DRS45310-NH-20 Page 11
515	520		(7) Any adjustment to the bill, including negotiated insurance rates or other 1
516	521		discounts. 2
517	522		(8) The amount of any payments received, whether from the patient or any other 3
518	523		party. 4
519	524		(9) Any interest or fees. 5
520	525		(10) Whether the patient was screened for financial assistance. 6
521	526		(11) Whether the patient was found eligible for financial assistance and, if so, the 7
522	527		amount due after all financial assistance has been applied to the itemized bill. 8
523	528		(12) That financial assistance may be available and instructions on how to apply 9
524	529		for it. 10
525	530		(13) Information about payment plans available, including the duration of plans 11
526	531		and caps on payments. 12
527	532		"§ 131E-214.34. Prohibition against collection of medical debt during health insurance 13
528	533		appeals. 14
529	534		(a) A medical creditor or medical debt collector that knows or should have known about 15
530	535		an internal review, external review, or other appeal of a health insurance decision that is pending 16
531	536		now or was pending within the previous 180 days shall not do any of the following: 17
532	537		(1) Communicate with the consumer regarding the unpaid charges for health care 18
533	538		services for the purpose of seeking to collect the charges. 19
534	539		(2) Initiate a lawsuit or arbitration proceeding against the consumer relative to 20
535	540		unpaid charges for health care services. 21
536	541		(b) No medical creditor that knows or should have known about an internal review, 22
537	542		external review, or other appeal of a health insurance decision that is pending now or was pending 23
538	543		within the previous 180 days shall refer, place, or send the unpaid charges for health care services 24
539	544		to a medical debt collector, including by selling the debt to a medical debt buyer. 25
540	545		"§ 131E-214.35. Interest on medical debt. 26
541	546		(a) Interest on medical debt shall be limited to no more than two percent (2%) per annum. 27
542	547		Late payments shall not result in a default interest rate. If a patient is charged a late fee, that fee 28
543	548		shall not exceed the lesser of twenty-five dollars ($25.00) or one percent (1%). Patients eligible 29
544	549		for financial assistance shall not be charged any interest or late fees. 30
545	550		(b) The rate of interest provided in subsection (a) of this section shall also apply to any 31
546	551		judgments on medical debt, notwithstanding any other provision of law or agreement to the 32
547	552		contrary. 33
548	553		"§ 131E-214.36. Medical debt payment plans. 34
549	554		(a) Medical creditors and medical debt collectors shall offer any patient that qualifies for 35
550	555		financial assistance or who owes a medical debt over five hundred dollars ($500) a payment plan 36
551	556		of not less than 36 months and shall not require the patient to make monthly payments exceeding 37
552	557		five percent (5%) of the patient's household income. 38
553	558		(b) Any medical creditor or medical debt collector that agrees to a payment plan for a 39
554	559		medical debt shall provide a written copy of the payment plan to the consumer within five 40
555	560		business days of entering into the payment plan. This plan shall prominently disclose the rate of 41
556	561		any interest being applied to the debt in compliance with G.S. 131E-214.35 and the date by which 42
557	562		the account will be paid off in full, assuming the payments set by the schedule are made without 43
558	563		interruption. 44
559	564		(c) A consumer need not make a payment on the payment plan until the written copy has 45
560	565		been provided. 46
561	566		(d) A medical debt payment plan may be accelerated or declared in default or no longer 47
562	567		operative due to nonpayment only after the patient fails to make scheduled payments on the 48
563	568		payment plan for at least three consecutive months. Before declaring the payment plan no longer 49
564	569		operative, the medical creditor or medical debt collector shall make at least three reasonable 50
565	570		attempts to contact the patient by telephone or other method preferred by the patient. 51 General Assembly Of North Carolina Session 2025
566		-	Page 12 ~~Senate Bill 672-First Edition~~
	571	+	Page 12 DRS45310-NH-20
567	572		Additionally, notice must be provided in writing that the payment plan may become inoperative 1
568	573		and informing the patient of the opportunity to renegotiate the payment plan. Prior to the payment 2
569	574		plan being declared inoperative, the medical creditor shall attempt to renegotiate the terms of the 3
570	575		defaulted payment plan, if requested by the patient. The medical creditor shall not commence a 4
571	576		civil action against the patient or responsible party for nonpayment until at least 90 days after the 5
572	577		payment plan is declared to be no longer operative. For purposes of this section, the notice and 6
573	578		telephone call to the patient may be made to the last known telephone number and address of the 7
574	579		patient. 8
575	580		(e) A payment plan shall not include any penalties or fees for prepayment, early payment, 9
576	581		or early payoff. 10
577	582		"§ 131E-214.37. Receipts for payments. 11
578	583		Within 10 business days of receipt of a payment on a medical debt, the medical creditor or 12
579	584		medical debt collector, or any of their agents receiving the payment, shall furnish a receipt to the 13
580	585		person that made the payment. All receipts shall include the following information: 14
581	586		(1) The amount paid. 15
582	587		(2) The date payment was received. 16
583	588		(3) The account's balance before the most recent payment. 17
584	589		(4) The new balance after application of the payment. 18
585	590		(5) The interest rate and interest accrued since the consumer's last payment. 19
586	591		(6) The consumer's account number. 20
587	592		(7) The name of the current owner of the debt and, if different, the name of the 21
588	593		medical creditor. 22
589	594		(8) Whether the payment is accepted as payment in full of the debt. 23
590	595		(9) The date of service when the health care services were provided. 24
591	596		"§ 131E-214.38. Debt forgiven by medical center. 25
592	597		Forgiveness of any part of an insured patient's copayment, coinsurance, deductible, facility 26
593	598		fees, out-of-network charges, or other cost-sharing shall not be a breach of contract or other 27
594	599		violation of an agreement between the medical creditor and the insurer or payor. 28
595	600		"§ 131E-214.39. Private remedy. 29
596	601		(a) Any medical creditor or medical debt collector who violates this Article, regardless 30
597	602		of whether the violation was committed knowingly, shall be liable to the consumer against whom 31
598	603		the violation occurred in a private right of action for the greater of (i) up to treble the amount 32
599	604		fixed by a damages verdict in favor of the plaintiff, or (ii) civil penalties as the court may allow, 33
600	605		but not less than five hundred dollars ($500) nor greater than four thousand dollars ($4,000) for 34
601	606		each violation. 35
602	607		(b) If judgment is entered in favor of a plaintiff for a claim for violation of this Article, 36
603	608		the defendant shall be liable for the costs of the action together with reasonable attorney fees as 37
604	609		determined by the court. 38
605	610		(c) This section applies to any medical creditor or medical debt collector that seeks to 39
606	611		avoid its application by any device, subterfuge, or pretense whatsoever. 40
607	612		(d) A consumer may bring an action for violation of this Article within four years from 41
608	613		the date on which the violation occurred. 42
609	614		(e) Any consumer may sue for injunctive or other appropriate equitable relief to enforce 43
610	615		this Article. 44
611	616		(f) The remedies provided in this section are not intended to be the exclusive remedies 45
612	617		available to a consumer nor must the consumer exhaust any administrative remedies provided 46
613	618		under this Article or any other applicable law. 47
614	619		(g) No MDMP or agreement between the patient and a large health care provider or 48
615	620		medical debt collector shall contain a provision that, prior to a dispute arising, waives or has the 49
616	621		practical effect of waiving the rights of a patient to resolve that dispute by obtaining: 50
617	622		(1) Injunctive, declaratory, or other equitable relief. 51 General Assembly Of North Carolina Session 2025
618		-	~~Senate Bill 672-First Edition~~ Page 13
	623	+	DRS45310-NH-20 Page 13
619	624		(2) Multiple or minimum damages as specified by statute. 1
620	625		(3) Attorney's fees and costs as specified by statute or as available at common 2
621	626		law. 3
622	627		(4) A hearing at which that party can present evidence in person. 4
623	628		Any provision in a financial assistance policy or other written agreement violating this 5
624	629		subsection shall be void and unenforceable. A court may refuse to enforce other provisions of 6
625	630		the financial assistance policy or other written agreement as equity may require. 7
626	631		"§ 131E-214.40. Prohibition of waiver of rights. 8
627	632		Any waiver by any patient or other consumer of any protection provided by or any right of 9
628	633		the patient or other consumer under this Article is void and may not be enforced by any court or 10
629	634		any other person. 11
630	635		"§ 131E-214.41. Enforcement. 12
631	636		(a) The Attorney General shall have the authority to enforce this Article and may adopt 13
632	637		any rules believed to be necessary or appropriate to effectuate the purpose of this Article, to 14
633	638		provide for the protection of patients and their families, and to assist market participants in 15
634	639		interpreting this Article. 16
635	640		(b) The Attorney General shall establish a complaint process allowing an aggrieved 17
636	641		patient or any member of the public to file a complaint against a medical creditor or debt collector 18
637	642		who violates any provision of this Article. All complaints shall be considered public records 19
638	643		pursuant to Chapter 132 of the General Statutes with the exception of the complainant's name, 20
639	644		address, or other personal identifying information. 21
640	645		"§ 131E-214.42. Annual reports and database. 22
641	646		(a) On or before July 1 of each year each large health care facility shall file its MDMP 23
642	647		and an annual report with the Department of Health and Human Services pursuant to procedures 24
643	648		that the Department shall establish. If the health care facility is required to report to the 25
644	649		Department under G.S. 131E-214.14, that health care facility does not need to submit separate 26
645	650		reports to satisfy each reporting requirement; the health care facility may submit one report, so 27
646	651		long as the report contains all of the information required under this Article and 28
647	652		G.S. 131E-214.14. 29
648	653		(b) The Department shall post each report and MDMP in a searchable database accessible 30
649	654		on the internet. 31
650	655		(c) The Department shall consult with North Carolina's Medical Care Advisory 32
651	656		Committee, Beneficiary Advisory Council, and Medicaid Advisory Council to develop materials 33
652	657		to inform the public about MDMP policies. The materials shall include, at a minimum, the 34
653	658		following information: 35
654	659		(1) How to find a facility's MDMP. 36
655	660		(2) How to apply for financial assistance and appeal assistance decisions. 37
656	661		(3) How to submit a complaint to the Attorney General or the Department. 38
657	662		(4) Any deadlines patients should be aware of related to the MDMP. 39
658	663		(5) The statutory eligibility and requirements for financial assistance and payment 40
659	664		plans. 41
660	665		(d) Each large health care facility shall prepare an annual report to submit to the 42
661	666		Department no later than August 1 of each year. The report shall include: 43
662	667		(1) The total number of patients who applied for financial assistance. 44
663	668		(2) The total number of patients who received financial assistance. 45
664	669		(3) The total number of patients that were denied financial assistance, categorized 46
665	670		by the specific reason for denial. 47
666	671		(4) De-identified demographic information for patients who received financial 48
667	672		assistance, including zip code, race, language, gender, and disability status, to 49
668	673		the extent such information is available. 50 General Assembly Of North Carolina Session 2025
669		-	Page 14 ~~Senate Bill 672-First Edition~~
	674	+	Page 14 DRS45310-NH-20
670	675		(5) The total amount of financial assistance provided to patients based on a cost 1
671	676		to charge ratio and Medicare reimbursement rates. 2
672	677		(6) The types of collection practices used by the large health care facility against 3
673	678		patients. 4
674	679		(7) The amount of money collected with each of these collection practices, in 5
675	680		dollars and by percentage of the large health care provider's annual revenue. 6
676	681		(e) An annual consolidated report shall be prepared by the Department and a copy of the 7
677	682		report provided to the Senate Committee on Health Care and the House Committee on Health. 8
678	683		The report shall also be made available to the public on the Department's website no later than 9
679	684		September 1 of each year. These reports shall include the following information for the time 10
680	685		period of July of the prior year to July of the current year, for each large health care provider in 11
681	686		aggregate: 12
682	687		(1) The total number of patients who applied for financial assistance. 13
683	688		(2) The total number of patients who received financial assistance. 14
684	689		(3) The total number of patients that were denied financial assistance, categorized 15
685	690		by the specific reason for denial. 16
686	691		(4) De-identified demographic information for patients who received financial 17
687	692		assistance, including zip code, race, language, gender, and disability status, to 18
688	693		the extent such information is available. 19
689	694		(5) The total amount of financial assistance provided to patients based on a cost 20
690	695		to charge ratio and Medicare reimbursement rates. 21
691	696		(6) The types of collection practices used by large health care providers against 22
692	697		patients. 23
693	698		(7) The amount of money collected with each of these collection practices, in 24
694	699		dollars and by percentage of the large health care provider's annual revenue. 25
695	700		"§ 131E-214.43. Severability. 26
696	701		Should a court decide that any provision of this Article is unconstitutional, preempted, or 27
697	702		otherwise invalid, that provision shall be severed and shall not affect the validity of the Article 28
698	703		other than the part severed. 29
699	704		"§ 131E-214.44. Exemptions. 30
700	705		Federally qualified health centers, as defined by section 1396d (i)(2)(B) of Title 42 of the 31
701	706		United States Code, are exempt from G.S. 131E-214.23 through 131E-214.26, 131E-214.28, and 32
702	707		131E-214.40." 33
703	708		34
704	709		PART II. REMOVE LIENS FOR AMBULANCE SERVICES 35
705	710		SECTION 2. Article 9A and Article 9B of Chapter 44 of the General Statutes are 36
706	711		repealed. 37
707	712		38
708	713		PART III. REMOVE UNC ABILITY TO GARNISH TAX REFUNDS FOR MEDICAL 39
709	714		DEBT 40
710	715		SECTION 3. G.S. 105A-2(2) reads as rewritten: 41
711	716		"(2) Debt. – Any of the following, except as limited in sub-subdivision (f.) of this 42
712	717		subdivision:following: 43
713	718		… 44
714	719		f. For any school of medicine, clinical program, facility, or practice 45
715	720		affiliated with one of the constituent institutions of The University of 46
716	721		North Carolina that provides medical care to the general public and for 47
717	722		The University of North Carolina Health Care System and other 48
718	723		persons or entities affiliated with or under the control of The 49
719	724		University of North Carolina Health Care System, the term "debt" is 50
720	725		limited to the sum owed to one of these entities by law or by contract 51 General Assembly Of North Carolina Session 2025
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	726	+	DRS45310-NH-20 Page 15
722	727		following adjudication of a claim resulting from an individual's receipt 1
723	728		of hospital or medical services at a time when the individual was 2
724	729		covered by commercial insurance, Medicaid, Medicare, Medicare 3
725	730		Advantage, a Medicare supplement plan, or any other government 4
726	731		insurance." 5
727	732		6
728	733		PART IV. CONFLICTS AND EFFECTIVE DATE 7
729	734		SECTION 4.(a) To the extent this act is in conflict with G.S. 131E-91, 131E-99, or 8
730	735		131E-147.1, this act shall control. 9
731	736		SECTION 4.(b) Section 1 of this act becomes effective June 1, 2025, and applies to 10
732	737		medical debt collection activities occurring after that date and to agreements and contracts 11
733	738		entered into, amended, or renewed on or after that date. The remainder of this act is effective 12
734	739		when it becomes law. 13