An Act to Prevent Unscrupulous Medical Debt Recovery Practices

Joint Committee on Consumer Protection and Professional Licensure

The Massachusetts Health & Hospital Association (MHA), on behalf of our member hospitals, health systems, physician organizations and allied health care providers, appreciates the opportunity to submit comments in opposition to SB1235, “An Act to Prevent Unscrupulous Medical Debt Recovery Practices.”

SB1235 prohibits a hospital or community health center from placing a lien on the personal residence or automobile of a person receiving services from the Health Safety Net program. Health care providers do not utilize liens in the ordinary course of business. In fact, since the creation of the Health Safety Net program, no hospital or community health center in the Commonwealth has executed such a lien. However, the ability to do so should remain as a mechanism of absolute last resort in certain instances. A similar prohibition is already a regulatory requirement under the Executive Office of Health & Human Services Regulations (please see 114.6 CMR 13.08 (1) (b)). In addition, the federal Internal Revenue Services also strictly limits the ability of hospitals and health centers from using liens on property such as homes and automobiles. Under both the federal and state regulation, a hospital or health center is already prohibited from seeking or executing a lien against the personal residence or the automobile of a low income patient without the specific review, discussion and approval of the hospital or health center’s board of trustees. In addition, the Attorney General’s Recommended Hospital Debt Collection Practices, outlined in the Attorney General’s Community Benefit Guidelines Appendix II (10), recommend that hospitals not seek to garnish a patient’s income or wages or seek a lien on a patient’s personal residence or motor vehicle to collect patient debt unless specifically approved by the hospital’s board of directors. Taken together, these existing regulations and recommended practices set forth appropriate safeguards in a more detailed and comprehensive manner than the restriction proposed by SB1235. These policies recognize that, in very rare instances, if a patient is able to pay for or cover their cost of care through the placement of such a lien, it should be allowed following due deliberation by a community board of trustees.

Thank you for the opportunity to offer comments on these important matters. If you have any questions or concerns or require further information, please contact Michael Sroczynski, MHA’s Vice President of Government Advocacy, at (781) 262-6055 or msroczynski@mhalink.org.