Bill Text: MI SB0952 | 2023-2024 | 102nd Legislature | Introduced
Bill Title: Health facilities: hospitals; collection of debts; prohibit if hospital is not in compliance with price transparency laws. Creates new act.
Spectrum: Partisan Bill (Republican 6-0)
Status: (Introduced) 2024-06-26 - Referred To Committee On Finance, Insurance, And Consumer Protection [SB0952 Detail]
Download: Michigan-2023-SB0952-Introduced.html
SENATE BILL NO. 952
A bill to prohibit hospitals from attempting to collect debts incurred when not in compliance with price transparency laws; and to provide remedies.
the people of the state of michigan enact:
Sec. 1. This act may be cited as the "hospital price transparency act".
(a) "Centers for Medicare and Medicaid Services" means the Centers for Medicare and Medicaid Services in the United States Department of Health and Human Services.
(b) "Collection action" means any of the following actions taken with respect to a debt for items and services that were purchased from, or provided to a patient by, a hospital on a date during which the hospital was not in material compliance with hospital price transparency laws:
(i) An attempt to collect a debt from a patient or patient guarantor by referring the debt, directly or indirectly, to a debt collector, a collection agency, or another third party retained by or on behalf of the hospital.
(ii) Suing the patient or patient guarantor or enforcing an arbitration or mediation clause in any hospital documents, including contracts, agreements, statements, or bills.
(iii) Directly or indirectly having a report made to a consumer reporting agency.
(c) "Collection agency" means, subject to subdivision (d), a person that does any of the following:
(i) Engages in a business, the principal purpose of which is the collection of debts.
(ii) Regularly collects or attempts to collect, directly or indirectly, debts owed or due or asserted to be owed or due to another.
(iii) Takes assignment of debts for collection purposes.
(iv) Directly or indirectly solicits for the collection of debts owed or due or asserted to be owed or due to another.
(d) Collection agency does not include any of the following, except as provided in subdivision (e):
(i) An officer or employee of a creditor while, in the name of the creditor, the officer or employee is collecting debts for the creditor.
(ii) A person while acting as a collection agency for another person, both of whom are related by common ownership or affiliated by corporate control, if the person acting as a collection agency does so only for creditors to whom it is so related or affiliated and if the principal business of the person is not the collection of debts.
(iii) An officer or employee of the United States or any state to the extent that collecting or attempting to collect a debt is in the performance of the officer's or employee's official duties.
(iv) A person while serving or attempting to serve legal process on another person in connection with the judicial enforcement of a debt.
(v) A person licensed to provide debt management services under the debt management act, 1975 PA 148, MCL 451.411 to 451.437.
(vi) A person that is collecting or attempting to collect a debt owed or due or asserted to be owed or due to another person to the extent that any of the following apply:
(A) The activity is incidental to a bona fide fiduciary obligation or a bona fide escrow arrangement.
(B) The activity concerns a debt that was extended by the person attempting to collect the debt.
(C) The activity concerns a debt that was not in default at the time it was obtained by the person attempting to collect the debt.
(D) The activity concerns a debt obtained by the person attempting to collect the debt as a secured party in a commercial credit transaction involving the creditor.
(vii) A person whose principal business is the making of loans or the servicing of debt not in default and that acts as a loan correspondent, seller and servicer for the owner, or holder of a debt that is secured by a deed of trust on real property, regardless of whether the debt is also secured by an interest in personal property.
(viii) A licensee under any of the following acts:
(A) The horse racing law of 1995, 1995 PA 279, MCL 431.301 to 431.336.
(B) The McCauley-Traxler-Law-Bowman-McNeely lottery act, 1972 PA 239, MCL 432.1 to 432.47.
(C) The Traxler-McCauley-Law-Bowman bingo act, 1972 PA 382, MCL 432.101 to 432.152.
(D) The Michigan Gaming Control and Revenue Act, 1996 IL 1, MCL 432.201 to 432.226.
(E) The lawful sports betting act, 2019 PA 149, MCL 432.401 to 432.419.
(F) The fantasy contests consumer protection act, 2019 PA 157, MCL 432.501 to 432.516.
(G) The lawful internet gaming act, 2019 PA 152, MCL 432.301 to 432.322.
(e) Collection agency includes a person that, in the process of collecting the person's own debts, uses another name that would indicate that a third person is collecting or attempting to collect the debts.
(f) "Consumer reporting agency" means a person that, for monetary fees or dues or on a cooperative nonprofit basis, regularly engages, in whole or in part, in the practice of assembling or evaluating consumer credit information or other information on consumers for the purpose of furnishing consumer reports to third parties. Consumer reporting agency includes a person defined in 15 USC 1681a(f). Consumer reporting agency does not include a person that provides check verification or check guarantee services only.
(g) "Debt" means an obligation or alleged obligation of a consumer to pay money arising out of a transaction, regardless of whether the obligation has been reduced to judgment. Debt does not include a debt for business, investment, commercial, or agricultural purposes or a debt incurred by a person engaged in business.
(h) "Debt collector" means any person employed or engaged by a collection agency to perform the collection of debts owed or due or asserted to be owed or due to another person.
(i) "Hospital" means, consistent with 45 CFR 180.20, a hospital licensed under article 17 of the public health code, 1978 PA 368, MCL 333.20101 to 333.22260.
(j) "Hospital price transparency laws" means 42 USC 300gg-18(e) and regulations adopted by the United States Department of Health and Human Services implementing 42 USC 300gg-18(e).
(k) "Items and services" means that term as defined in 45 CFR 180.20.
(l) "Person" means an individual or a partnership, corporation, limited liability company, association, governmental entity, or other legal entity.
Sec. 3. (1) Subject to subsection (2), after the effective date of this act, a hospital that is not in material compliance with hospital price transparency laws on the date that items and services are purchased from, or provided to a patient by, the hospital shall not initiate or pursue a collection action against the patient or patient guarantor for a debt owed for the items and services.
(2) After 6 months after the effective date of this act, this act applies to critical access hospitals licensed and certified by the department of health and human services under 42 CFR 485 subpart F.
(3) If a patient believes that a hospital was not in material compliance with hospital price transparency laws on a date after the effective date of this act and that items and services were purchased by or provided to the patient on that date, and if the hospital takes a collection action against the patient or patient guarantor regarding the items and services, the patient or patient guarantor may file a civil action to determine if the hospital was materially out of compliance with the hospital price transparency laws on the date of service and if the noncompliance is related to the items and services. The hospital shall not take a collection action against the patient or patient guarantor while the civil action is pending.
(4) If the judge or a jury in a civil action under this act, considering compliance standards issued by the Centers for Medicare and Medicaid Services, determines that a hospital was materially out of compliance with hospital price transparency laws, the hospital shall do all of the following:
(a) Refund the payer any amount of the debt the payer has paid and pay a penalty to the patient or patient guarantor an amount equal to the total amount of the debt.
(b) Dismiss or move to dismiss with prejudice any court action based on the debt and pay any attorney fees and costs incurred by the patient or patient guarantor relating to the action.
(c) Remove or have removed from the patient's or patient guarantor's credit record any report made to a consumer reporting agency relating to the debt.
(5) This act does not do any of the following:
(a) Prohibit a hospital from billing a patient, patient guarantor, or third-party payer, including a health insurer, for items and services provided to the patient.
(b) Require a hospital to refund any payment made to the hospital for items and services provided to the patient, if no collection action is taken in violation of this act.
