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Senate committee reviews S.27 to fund medical-debt abolition, bar medical debt from credit reports and add behavioral-health definition
Summary
S.27 would appropriate $1 million to the treasurer to contract with a nonprofit to buy and abolish eligible medical debt, require notice to individuals whose debt was canceled, and add a Title 1 definition of "behavioral health" that excludes mental health conditions and substance use disorders for the statute's purposes.
The Senate Health & Welfare Committee reviewed S.27, a bill returned from the House that would authorize a $1 million appropriation to the state treasurer to contract with a nonprofit entity to purchase and abolish certain medical debt and bar credit reporting agencies from including medical debt information in consumer files.
Jen Harvey, counsel in the Office of Legislative Counsel, summarized the House amendments and the bill's mechanics. The bill would appropriate $1 million from the general fund in fiscal year 2026 for the treasurer to contract with a nonprofit that would acquire eligible medical debt from health care providers at fair market value and abolish it "with no cost or tax consequences to the debtor," then coordinate with providers or…
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