(The Center Square) – North Carolinians struggling with medical debt could soon get relief from legislation that made its first appearance in the Senate Health Care Committee on Wednesday.
The Medical Debt De-Weaponization Act, Senate Bill 321, was presented to committee members for information only on Wednesday by Treasurer Dale Folwell, a Republican candidate for governor who has worked to address rising health care costs since taking office in 2017.
The intent behind the bill is to “advocate for the invisible” by strengthening hospital price transparency, while limiting the ability of large medical facilities to charge unreasonable interest rates or use unfair debt collection tactics, he said.
“We are now in a crisis where people are in fear” of medical issues and the bills that come with them, Folwell said. “People should not fear getting medical attention in this state.”
Eastern North Carolina is home to some of the highest concentrations of medical debt in collections in the nation. In Greene and Lenoir counties, 44% of residents have medical debt in collections. In Tyrell County it’s 40%, and in Duplin County 38%, or about three times the national average.
Across the state, about one in five families are in medical debt collections, according to Folwell.
That debt is mounting as a majority of nonprofit hospitals have failed to equal their tax exemptions with financial assistance for low income patients. Recent reports have shown some hospitals billed $149 million to poor patients that should qualify for assistance or encouraged tens of thousands to open medical credit cards with up to 18% interest.
Atrium Health, for example, has sued more than 1,000 patients for medical debt, including during the pandemic.
Hospital officials have disputed reported charity care shortfalls and taken issue with the title of SB 321, though none testified during Wednesday’s committee hearing.
SB 321 would require hospitals to screen patients for eligibility for public assistance programs, and to publicize both a Medical Debt Mitigation Policy and prices online.
Other provisions would hold debt collections in abeyance during insurance appeals, shield family members from medical and nursing home debts, require detailed receipts of payments, and cap interest rates for medical debt at 5%.
“A lifesaving procedure shouldn’t cost your life savings,” Folwell said in a statement. “Families need protection from the weaponization of medical debt, and the first step is transparency. This bill would stop hospitals in the cartel from hiding their prices, and it would prevent hospitals from breaking patients’ kneecaps when they can’t afford to pay.”
The treasurer told lawmakers Wednesday North Carolina is currently ranked among the most unaffordable and monopolistic states in the nation for health care, and SB 321 would make the Old North State second in the nation for consumer protections against medical debt.
The bill is backed by the State Employees Association of North Carolina and a bipartisan coalition of lawmakers.
“I think everybody in this room, probably everybody in this state, has dealt with this issue,” Sen. Julie Mayfield, D-Buncombe, said Wednesday as she thanked Folwell for pursuing solutions.
SB 321 is scheduled for a vote in the same committee on Thursday, while identical legislation, House Bill 367, is pending in the lower chamber’s Committee on Appropriations.
