State Rep. Angela Rigas today joined a bipartisan group of lawmakers from both the state House and Senate to introduce a plan to shield families from aggressive medical debt collection practices and ensure fair treatment under the Michigan Consumer Protection Act. State Rep. Laurie Pohutsky and state Sens. Sarah Anthony and Jonathan Lindsey also sponsored the measures, which will cap interest on medical debt, restrict extraordinary collection actions, and explicitly prohibit violations of these protections as unfair trade practices.

“Medical debt affects millions of Michiganders, often leading to bankruptcy, denied care, or ruined credit. By curbing predatory practices, we can ease burdens on working families without undue strain on providers,” said Rigas, R-Caledonia. “People who are paying their debt should not be living in fear of foreclosure or bankruptcy.”

“It is imperative that we address the out-of-control cost of healthcare,” said Lindsey, R-Coldwater. “But until that happens, we must also confront the stark reality that too many Michiganders are failed by the current system and saddled with extraordinary medical debt.”

Identical legislation will be introduced in both chambers of the Michigan Legislature. One bill – sponsored by Rigas, HB 5254, and Lindsey – will add violations of the proposed Medical Debt Protection Act as an unfair, unconscionable, or deceptive practice in trade or commerce, empowering the Attorney General to enforce medical debt safeguards through existing consumer protection remedies.

“Health care continues to be unaffordable for millions of Americans. Michiganders are shouldering mountains of medical debt, which remains the leading cause of bankruptcy. We need to take the necessary steps now to protect Michiganders from the harms of medical debt,” said Pohutksy, D-Livonia. “This bill will place caps on fees, prohibit extreme collection actions, restrict and properly regulate the sale of medical debt and require that any overpayments are refunded within 60 days. These are critical first steps to address the medical debt crisis and ensure access to affordable health care for every Michigander.”

The other bill – sponsored by Anthony and Pohutsky, HB 5255, – establishes comprehensive protections for patients facing medical debt, including:

• Interest and Fee Caps: Large healthcare facilities – hospitals or providers with more than $20 million annual revenue – and medical debt buyers cannot charge interest or late fees until 90 days after the final invoice due date, with a strict 3% annual cap thereafter.
• Limits on Extraordinary Collection Actions: Prohibits arrests, real property foreclosures, personal property liens, and wage garnishment for those qualifying for financial assistance. Defers any aggressive actions – like credit reporting, liens, lawsuits — until 120 days post-invoice, with 30-day advance notice including financial assistance details.
• Debt Sale Restrictions: Medical creditors may only sell debt under binding agreements that bind buyers to the same caps, prohibit extra collection tactics, allow debt recall for assistance-eligible patients, and hold sellers liable for buyer violations.
• Refunds and Transparency: Requires refunds for overpayments within 60 days and mandates that collection policies disclose actions upfront. Violations are enforceable via the Consumer Protection Act, with the bills contingent on mutual enactment for full effect.

 “For too many Michigan families, one trip to the emergency room can lead to months or even years of financial hardship — even for those who are fortunate enough to have health insurance. This reality is unacceptable. Plain and simple,” said Sen. Anthony, D-Lansing. “As we see a concerted attack on health care access coming from Washington, the number of Michiganders shouldering medical debt will only continue to grow. It’s up to us at the state-level to provide an additional line of defense, and this practical, proactive legislation will help us ensure families are not condemned to a cycle of poverty simply for seeking necessary health care.”

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