An act relating to medical debt relief and excluding medical debt from credit reports
Sponsored By: Virginia "Ginny" V Lyons (Democratic)
Signed by Governor
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Bill Overview
Analyzed Economic Effects
3 provisions identified: 3 benefits, 0 costs, 0 mixed.
Medical debt stays off credit reports
Beginning July 1, 2025, credit reporting agencies cannot report or keep covered medical debt in a consumer's credit file. Large health care facilities and medical debt collectors also cannot send any part of that debt to credit reporting agencies. Covered debt includes charges for health care services, goods, devices, and medicines, but not veterinary bills or secured debt. Home equity and general-purpose credit lines are excluded. Credit card or payment-plan debt is excluded unless the card or plan is offered only for health care costs.
Medical debt relief for eligible Vermonters
Beginning July 1, 2025, Vermont provides $1 million for fiscal year 2026 for medical debt relief. The State Treasurer contracts with a nonprofit to buy debt from providers at fair market value and cancel it. Eligible Vermont residents must still owe a balance after the provider finishes routine collection efforts. Household income must be at or below 400% of the federal poverty level for household size, or medical debt must equal at least 5% of household income. Cancellation costs the debtor nothing and creates no tax bill; the nonprofit must coordinate removal of related negative credit information. Notices must list the canceled amount, providers, estimated household income as a percentage of the poverty level, and hospital assistance. Existing hospital assistance includes full discounts at or below 250% of the poverty level and at least 40% discounts above 250% through 400%.
Nonprofits gain tools for medical debt relief
Beginning July 1, 2025, qualifying 501(c)(3) tax-exempt nonprofits can request credit reports to check eligibility for medical debt cancellation. They receive an exemption from state credit-report request requirements for this purpose; large health care facilities cannot use it. Vermont consumer disclosures must explain this allowed use. Large health care facilities can sell or transfer medical debt only to qualifying nonprofits specifically to cancel it. These rules do not require a transfer or guarantee cancellation of any person's debt.
Sponsors & Cosponsors
Sponsor
Virginia "Ginny" V Lyons
Democratic • Senate
Cosponsors
Alison Clarkson
Democratic • Senate
Ann E Cummings
Democratic • Senate
Anne E Watson
Democrat/Progressive • Senate
Brian P Collamore
Republican • Senate
Joseph "Joe" D Major
Democratic • Senate
Kesha K Ram Hinsdale
Democratic • Senate
Sen. Larry Hart
Affiliation unavailable
Martine Larocque L Gulick
Democratic • Senate
Nader A Hashim
Democratic • Senate
Patrick "Pat" M Brennan
Republican • Senate
Philip E Baruth
Democrat/Progressive • Senate
Rebecca "Becca" E White
Democratic • Senate
Richard A Westman
Republican • Senate
Robert W Norris
Republican • Senate
Robert Plunkett
Democratic • Senate
Ruth E Hardy
Democratic • Senate
Scott L Beck
Republican • Senate
Seth Bongartz
Democratic • Senate
Tanya C Vyhovsky
Democrat/Progressive • Senate
Thomas I Chittenden
Democratic • Senate
Wendy K Harrison
Democratic • Senate
Roll Call Votes
No roll call votes available for this bill.
Actions Timeline
Senate Message: Signed by Governor May 15, 2025
5/16/2025SenateSigned by Governor on May 15, 2025
5/16/2025SenateDelivered to Governor on May 9, 2025
5/9/2025SenateAs passed by Senate and House
5/6/2025SenateHouse message: House concurred in Senate proposal of amendment to House proposal of amendment
5/6/2025HouseSenate proposal of amendment to House proposal of amendment concurred in
5/2/2025HouseAction Calendar: Senate Proposal of Amendment to House Proposal of Amendment
5/2/2025HouseNotice Calendar: Senate Proposal of Amendment to House Proposal of Amendment
5/1/2025HouseSenate Message: House proposal of amendment concurred in with further proposal of amendment thereto
4/30/2025SenateHouse proposal of amendment concurred in with further proposal of amendment as moved by Senator(s) Lyons and Perchlik
4/29/2025SenateHouse proposal of amendment; text
4/29/2025SenateConsideration resumed
4/29/2025SenatePending question: Shall the Senate concur in the House proposal of amendment??
4/29/2025SenateProposal of amendment to be offered by Senator(s) Lyons and Perchlik
4/29/2025SenateUnfinished Business/House Proposal of Amendment
4/29/2025SenateConsideration postponed without objection
4/25/2025SenateHouse proposal of amendment; text
4/25/2025SenateNew Business/House Proposal of Amendment
4/25/2025SenateHouse proposal of amendment
4/24/2025SenateEntered on Notice Calendar
4/24/2025SenateHouse message: House passed bill in concurrence with proposal(s) of amendment
4/23/2025HouseRead third time and passed in concurrence with proposal of amendment
4/22/2025HouseAction Calendar: Third Reading
4/22/2025HouseThird Reading ordered
4/18/2025HouseReport of Committee on Health Care, as amended, agreed to
4/18/2025House
Bill Text
As Enacted (ACT 21)Opens in a new window
5/28/2025
As Passed by Both Chambers
5/8/2025
As Passed by Both Chambers (Unofficial)
5/8/2025
House Proposal of Amendment
4/23/2025
House Proposal of Amendment (Unofficial)
4/23/2025
As Passed by the Senate
3/25/2025
As Passed by the Senate (Unofficial)
3/25/2025
As Introduced
1/27/2025
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