Maryland's Senate Bill 981, introduced on March 11, 2025, aims to protect patients from aggressive debt collection practices by hospitals, addressing a growing concern over medical debt in the state. The bill introduces several key provisions that restrict hospitals from taking extreme measures to collect unpaid bills, particularly from vulnerable patients.

One of the most significant aspects of Senate Bill 981 is the prohibition against hospitals requesting liens on a patient’s primary residence to collect debts. This measure seeks to prevent families from losing their homes due to unpaid medical bills. Additionally, the bill extends the time frame before hospitals can initiate debt collection actions from 180 to 240 days after the initial bill is issued, allowing patients more time to address their financial obligations without the threat of immediate legal action.

The legislation also includes protections against more severe collection tactics. Hospitals are barred from seeking body attachments or arrest warrants against patients for unpaid bills, and they cannot garnish wages if the patient qualifies for free or reduced-cost care. Furthermore, the bill stipulates that hospitals cannot claim debts against the estates of deceased patients who were eligible for free care or whose estates are valued below half of the owed debt.

Debate surrounding Senate Bill 981 has highlighted the balance between hospital financial stability and patient rights. Supporters argue that the bill is a necessary step to alleviate the burden of medical debt, which disproportionately affects low-income individuals and families. Critics, however, express concerns that these restrictions may hinder hospitals' ability to recover costs, potentially impacting their financial health and service delivery.

The implications of this bill are significant, as it addresses the broader issue of healthcare affordability in Maryland. Experts suggest that by reducing the pressure of medical debt, the bill could lead to improved health outcomes, as patients may be more likely to seek necessary care without the fear of financial repercussions.

As Senate Bill 981 moves through the legislative process, its potential to reshape the landscape of medical debt collection in Maryland remains a focal point of discussion. If passed, it could serve as a model for other states grappling with similar issues, emphasizing the need for a more compassionate approach to healthcare financing.