Committee considers ban on home liens and wage garnishments for medical debt
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Summary
Sen. Donna Bailey’s LD 21‑29 would bar liens on principal residences and wage garnishments for medical debt; patient‑advocacy groups and elder‑service attorneys testified in strong support and asked the committee to ensure the prohibition covers debts sold to third parties. Banks and others urged careful definitions to avoid unintended consequences.
Senator Donna Bailey told the Health Coverage, Insurance and Financial Services Committee LD 21‑29 would expand protections for Mainers with medical debt by prohibiting liens on principal residences and wage garnishments stemming from medical bills. Bailey framed the bill as a continuation of last session’s work to remove medical debt from credit reporting and to stop providers reporting medical debt to credit bureaus.
Patient advocates described the bill’s stakes. Ernie Davis of Blood Cancer United and the American Cancer Society Cancer Action Network said medical debt often arises through unavoidable emergencies and can lead to housing instability, lower treatment adherence, and long‑term financial harm. “LD 21‑29 prevents collection agencies from placing a lien on a home or withholding wages from individuals burdened by medical debt,” Davis said.
Elder‑service groups urged the committee to ensure protections apply whether debt is held by original providers or assigned to third‑party collectors. Marj Kalkeli of Legal Services for Maine Elders said liens and garnishments threaten housing stability for older Mainers who often have limited income and few assets.
Banking and industry perspectives: Josh Stearman of the Maine Bankers Association testified neither for nor against and urged the committee to retain clear statutory definitions of “medical debt” to avoid commingling with other obligations (for example, cash‑out mortgages used to pay medical bills). He reported Maine banks are not major actors in medical‑lending lines but urged careful drafting.
Next steps: Committee members asked for data on the current prevalence and fiscal impact of medical‑debt liens and garnishments and for an analysis of collections revenue now recovered by such actions. The committee closed the public hearing and will consider requests for work‑session information.
Ending: The committee heard strong personal and organizational testimony in favor and sought additional fiscal and prevalence data before advancing the bill.