The Medical Debt Cancellation Act would establish a federal grant program to help hospitals cancel existing medical debt owed by patients, with funding distributed through competitive grants starting within one year of enactment. The bill prioritizes grants to safety-net hospitals serving low-income populations and requires them to cancel at least medical debt that is 15 months old or less from emergency and non-elective care, while ensuring hospitals across diverse geographic areas receive support. The legislation also establishes new requirements for health care providers to inform patients about financial assistance before bills are due, limits medical debt collection practices by prohibiting interest charges and restricting collection amounts for uninsured patients at nonprofit hospitals, and prohibits debt collectors from collecting any medical debt incurred before the bill's enactment. Additionally, the bill directs the Department of Health and Human Services to create a public list of federal, state, and local financial assistance programs and requires credit reporting agencies to remove medical debt from consumer credit reports. The program would expand within two years to include providers and health care facilities beyond hospitals, with annual reporting to Congress on its progress until all eligible medical debt is certified as canceled.
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