On Tuesday, the North Carolina House Banking Commission discussed a law to de-weaponize medical debt, which is being advertised as a law to protect people struggling to pay their medical debt. HB 1039 aims to set transparent parameters for the provision of charity care, limiting the ability of large healthcare facilities to charge unreasonable interest rates and adopt unfair tactics for debt collection. increase.
Ed Goodwin, Congressman of R-Chowan, one of the main co-sponsors of the bill, said: “They are said to be able to use their credit cards to help pay for medical expenses, gas, groceries, or whatever they want. Now you are preying on poor charity. Predatory lending is how I refer to it. “
Howard Hunter, D-Hartford; Bobby Hanig R-Currituck; Another major co-sponsor of the bill is D-Cumberland’s Billy Richardson.
The bill is partly due to the reaction of lawmakers. A report from the Johns Hopkins Bloomberg School of Public Health and the North Carolina State Health Program in October 2021 found that most North Carolina hospitals did not respect their commitment to charity care. According to the report, the hospital received a tax deduction of over $ 1.8 billion, “Charity care” spending did not exceed 60% of the estimated tax exemption on most of the state’s largest healthcare systems. About 25 of the 100+ nonprofits have run out of tax cuts in charity care.
Perhaps the biggest defender of the bill is State Treasurer Dale Folwell. Too many things, he devoted himself to recovering medical debt and confirmed what people were facing when it happened to them. “Last fall I went to get a contrasting MRI,” he said. “I was there for 8 minutes, and it cost $ 6,000, and they wanted $ 1500 at the time of sale. Based on this particular medical experience, I receive a number of calls, texts, and letters every day. I gave them $ 500 because I wanted to deliberately devote myself to debt collection to see if. “
He said he could pay for medical care today, but he really wants to understand what’s going on in the situation.
For those who were ill at the time, Folwell said the bill was moral, independent of politics, race, and gender, and credit scores could impair upward mobility. He said it was necessary to stop turning it into a weapon. For generations.
Low-income patients were charged when they were eligible for charity care, according to a report released by the accounting firm in January... Report, Compiled by North Carolina Health Plan And that National Institute of Health Policy, And, according to a peer-reviewed by Rice University researchers, 12-30% of bad debts, or $ 150 million, in 2019, despite tax incentives in favor of nonprofit hospitals. Was charged to poor patients eligible for free or discounted charity care. Worth more than $ 1.8 billion in 2020 received to offset the care given.
Folwell said credit scores can affect not only how much a person pays for a cell phone, basic liability insurance for a car, renting or buying a home, but also job acquisition. rice field.
“I am the chair of the state banking committee,” he said. “I can say that there are certain jobs that you can’t get at a particular financial institution because of your credit score, not because they committed a crime, but because they got sick.” He also said that people were due to medical debt. He said he had a liar in their house.
The law will require healthcare facilities to develop a healthcare debt reduction policy that builds on the existing framework of financial support plans under the Federal Health Insurance System Reform Act. It establishes a series of steps that someone must follow before being billed. These include policy posting and publication, online price posting in plain language, patient screening for eligibility for public support programs, and below 200% of federal poverty levels.
It also provides a transparent sliding scale of policy discounts for patients between 200% and 400% of federal poverty levels and provides those patients with the maximum predictable amount that may be charged in 12 months. Requires a clear pricing structure for. The bill prohibits interest claims from patients who receive a discount on insurance and suspends debt collection during an insurance appeal against uninsured patients.
This policy also protects families from spouse or parental medical and long-term care debt, requires receipt of detailed payments, and provides credit reporting of unpaid debt within one year of the patient’s claim. Prohibit.
Patients who are also found to be eligible for a discount after billing can receive a rebate.
Rep. John Soca of R-Cumberland criticized the bill, saying it was “not ready for prime time” that plagued him in many ways, including the poor receiving credit cards. “I want that proof,” he said. “Care credit cards cannot be used for groceries. They can be used by veterinarians (veterinarians), doctors, etc.”
He also works in the field of mortgages, constantly checking credit scores, and bad credit scores can hurt people across generations because there are ways people can modify their credit scores. Did not agree with. He also said that medical debt is viewed differently in credit scoring systems by all three credit bureaus, Experian, Equifax, and TransUnion. “They don’t count that much, and sometimes they don’t count at all,” he said. “When you say your credit score is weaponized, that’s an interpretation. If you see something you don’t agree with your credit score, you can dispute it.”
Szoka said the Consumer Finance Agency is looking at medical debt and credit scores and is trying to address the issue. He also said that it should be the responsibility of social welfare to determine if a person is capable of paying medical expenses rather than a hospital finance officer.
The bill will be further discussed and considered before being brought back to the Banking Commission.
