PHOENIX, Ari. (DDN) – A plan from state lawmakers would reform how medical debt affects Washingtonians’ credit scores.
Senate Bill 5480 “Declares a medical debt void and unenforceable if it is reported to a consumer credit reporting agency or credit bureau,” according to a Senate Bill Report.
The report states that the law “Prohibits specific entities from reporting medical debts to a consumer credit reporting agency or credit bureau, under penalty of violating the Consumer Protection Act.”
An Economic Opportunity Institute report from summer 2024 states that 95% of Washingtonians have health insurance, but spending exceeds income.
The report notes that 6.5% of Washington adults had medical debt, which is lower than many other states.
EOI reports that the average premium on the Washington marketplace, the Health Benefit Exchange, has grown 100% its launch in 2014.
Elizabeth New, Washington Policy Center Center for Health Care director, blogged against the bill.
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Her law requires healthcare providers to inform individuals before service that they cannot collect if the debt is disclosed to a credit bureau.
HB 5480 requires patients to be informed that non-payment may not result in care.
New said the law is unnecessary since healthcare providers are willing to help patients with financial issues.
In an executive session on Thursday, the Senate Law & Justice Committee examined multiple modifications to SB 5480, including one that would prevent cosmetic surgery patients from having medical debt nullified. That amendment passed.
The committee’s ranking Republican, Sen. Jeff Holy, R-Spokane Heights, advised against voting for the bill before a final vote.
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“We have another aspect of government overreach here to where we are again involving ourselves in business activities that will result in the socialization of the cost of credit to everybody out there, not just the few,” he said. “We are stepping on the toes of the process as it exists here for debt collection and the reporting agencies out there.”
Thursday’s Democratic committee vote sent the bill to the Senate Rules Committee.
Reference: Bill to remove medical debt from credit scores in Washington moves forward
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