HR7478119th CongressWALLET

Patient Debt Relief Act

Sponsored By: Representative Vasquez

Introduced

Summary

This bill would require Medicare-participating hospitals to follow new financial-assistance rules and strict limits on medical debt collection. It would also create a federal grant program to buy and discharge qualifying medical debt.

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  • Hospitals would have to publish a charity care or financial assistance policy, screen patients for eligibility, decide eligibility at least 30 days before payment is due, allow appeals, and pause collection until eligibility is determined. The bill adds civil monetary penalties for noncompliance up to $1,000,000 per instance with a 90-day notice and a 45-day window to show corrective action.
  • Patients and households would get stronger protections against harsh collections. Hospitals may not place liens, foreclose on homes, or garnish wages, and they generally cannot sell or assign debt unless it is over one year past due and a repayment option exists with monthly payments capped at 4 percent of gross monthly income; households at or below 250 percent of the poverty line cannot be charged interest or have their debt sold or assigned.
  • The bill creates a grant program to let the Department of Health and Human Services fund at most one eligible nonprofit to acquire and discharge medical debt. An "eligible individual" is someone whose medical debt is 5 percent or more of their modified adjusted gross income (MAGI) or whose household income is at or below 400 percent of the federal poverty line; grantees must notify people within 60 days and report quarterly.

*Authorizes $100 million for fiscal year 2027 for the grant program, increasing federal outlays to carry out medical debt relief.*

Bill Overview

Analyzed Economic Effects

2 provisions identified: 2 benefits, 0 costs, 0 mixed.

Grants to buy and forgive medical debt

If enacted, the Secretary would set up a grant program within one year to award grants to up to one nonprofit to identify, buy, and discharge medical debt for eligible people. An eligible person would be someone whose medical debt is at least 5% of their modified adjusted gross income for the most recent year, or whose household income is 400% of the poverty line or less. The grantee would have to notify each person within 60 days after buying and forgiving their debt and report to the Secretary at least quarterly. The bill would authorize $100,000,000 for fiscal year 2027 to carry out the program, available until spent.

New hospital limits on medical bills

This bill would require hospitals to publish a charity care or financial assistance policy and screen patients for help. If you apply, the hospital would decide if you qualify at least 30 days before a bill is due and could not try to collect until a decision is made. Hospitals would generally be barred from placing liens, foreclosing on homes, or garnishing wages to collect hospital medical debt. If your household income at the time of service was 250% of the poverty line or less, the hospital would not charge yearly interest and would not sell or assign that debt. Hospitals could sell debt only after one year, only if a repayment plan is offered with minimum payments no more than 4% of gross monthly income, and only if the buyer agrees to follow the same lien and wage rules. The bill would tie hospital participation in Medicare to complying with these rules starting January 1, 2028. It would also create a government portal (by January 1, 2028) for reporting noncompliance and require random hospital audits starting January 1, 2029. The bill would define ‘‘debt collector’’ and ‘‘medical debt’’ by reference to the Fair Debt Collection Practices Act and would let the Secretary impose civil penalties up to $1,000,000 per violation after specified notice and cure windows.

Sponsors & CoSponsors

Sponsor

Vasquez

NM • D

Cosponsors

  • Stansbury

    NM • D

    Sponsored 2/10/2026

  • Ruiz

    CA • D

    Sponsored 2/10/2026

  • Castor (FL)

    FL • D

    Sponsored 2/10/2026

  • Thanedar

    MI • D

    Sponsored 2/10/2026

  • Clarke (NY)

    NY • D

    Sponsored 2/10/2026

  • Schrier

    WA • D

    Sponsored 2/10/2026

  • Garcia (CA)

    CA • D

    Sponsored 2/10/2026

  • Barragan

    CA • D

    Sponsored 2/10/2026

  • Landsman

    OH • D

    Sponsored 2/10/2026

  • Frost

    FL • D

    Sponsored 2/10/2026

  • Del. Norton, Eleanor Holmes [D-DC-At Large]

    DC • D

    Sponsored 2/10/2026

  • Craig

    MN • D

    Sponsored 2/10/2026

  • Garcia (IL)

    IL • D

    Sponsored 2/10/2026

  • Simon

    CA • D

    Sponsored 2/10/2026

  • Goldman (NY)

    NY • D

    Sponsored 2/10/2026

  • Horsford

    NV • D

    Sponsored 2/10/2026

  • DelBene

    WA • D

    Sponsored 2/10/2026

  • Cohen

    TN • D

    Sponsored 2/23/2026

Roll Call Votes

No roll call votes available for this bill.

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