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Committee hears bill to standardize hospital financial assistance, ban small‑debt suits and curb medical debt reporting
Summary
House Bill 268 would set minimum reduced‑cost floors for hospital financial assistance, prohibit reporting small medical debts to credit agencies and ban suits under $500; advocates said the bill would reduce medical debt harms, hospitals warned about fiscal impacts and scope.
Delegate Laura Chercuttian told the committee that House Bill 268 aims to tighten Maryland hospital financial assistance policies and reduce medical debt harms, proposing four main changes: set minimum floors for reduced‑cost care between 200% and 500% of the federal poverty level; prohibit hospitals from reporting medical debt to consumer credit agencies; ban lawsuits for medical debt under $500; and bar hospitals from using a "signed under seal" clause that extends statutes of limitation.
Supporters including Maryland Legal Aid, Economic Action Maryland and Progressive Maryland said the bill would prevent patients from being surprised by bills and from having small medical accounts balloon into long‑lasting judgments. William Steinwoldle of Maryland Legal Aid described a client forced into bankruptcy after a judgment and noted Maryland’s 10% post‑judgment interest can quickly increase a debt. "Just because something starts at a low amount doesn't mean it stays there," he told the committee.
Megan Renfrew of the Health Services Cost Review Commission (HSCRC) testified that the bill would improve fairness by standardizing discounts across hospitals. HSCRC said increased financial assistance might be offset by lower bad‑debt expenses and that its rate‑setting policies would automatically adjust hospital revenue to cover allowed increased costs.
Hospital representatives raised concerns in written testimony over costs and operational burdens. Committee members asked about the fiscal note and how much any increase in uncompensated care would raise Medicaid and state expenditures; HSCRC explained it could not precisely model costs without additional data and provided a rough proportion example. Delegate Chercuttian said she sought more information from hospitals and would work with stakeholders to refine cost estimates.
The sponsor also noted an amendment in the packet to prohibit signing under seal and clarified the bill would require hospitals to obtain a signed acknowledgment from patients that they received notice of financial assistance policies during intake.
Ending: Supporters argued HB 268 would reduce predatory collection practices and increase transparency; opponents warned of costs and operational impacts. The committee heard multiple public witnesses and HSCRC; no final vote occurred during the hearing.
