As reported on KARE11.com, Governor Tim Walz has signed new legislation aimed at alleviating the burden of medical debt for Minnesotans. This move is designed to help residents manage their medical expenses without the fear of long-term financial repercussions.
“We all agree that if you borrow money, you should pay it back. We also all agree that we shouldn’t punish people for getting sick,” said Attorney General Keith Ellison.
Joining Governor Walz in this announcement were Attorney General Ellison, Senator Liz Boldon, and Representative Liz Reyer, the bill’s authors. Governor Walz highlighted the importance of the new law, stating, “Life-saving cancer treatments or a trip to the emergency room shouldn’t cause a tanked credit score or a lifetime of debt. Thanks to the work of the Attorney General, legislators, and Minnesotans who’ve shared their stories, these reforms will help Minnesotans get the care they need, manage their medical debt, and feel protected in their most vulnerable moments.”
This legislation, part of the Minnesota Debt Fairness Act, includes several measures to reduce the impact of medical debt:
- Prohibiting medical providers from denying medically necessary care due to unpaid debt.
- Preventing medical debt from affecting credit scores.
- Stopping automatic transfers of medical debt to a patient’s spouse.
- Implementing robust protections against unethical medical debt collection practices.
- Requiring medical providers to disclose their medical debt collection practices.
- Establishing a new process to help patients dispute medical coding and billing errors.
“Our debt systems shouldn’t drive people further into debt or poverty. No one should be turned away from medical care because of medical debt. The Debt Fairness Act fixes these – and other – aspects of our debt system, and I’m proud to see it signed into law today,” Governor Walz added.
The Minnesota Debt Fairness Act, passed in the 2024 session, also includes additional reforms such as setting automatic income-based wage garnishment levels ranging from 10% to 25%, replacing the previous flat 25% garnishment. The Act extends wage garnishment protections to independent contractors and all residents working in the state.
However, there was some opposition prior to the bill’s passage. Credit agencies and hospital groups expressed concerns about potential unintended consequences. These issues were raised during the Senate Commerce Committee hearing on March 14, 2024. Danny Ackert of the Minnesota Hospital Association highlighted that hospitals wrote off $537 million in uncollectible debt in 2022, with $280 million of that amount from insured patients unable to afford their copays and deductibles.
“The hospital association is concerned that provisions in Senate File 4065 pertain to medical debt in combination are not appropriately balanced,” Ackert told the panel.
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For more information, you can visit the original article on KARE11.com here.
