A new Commonwealth Fund study found significant gaps in state laws designed to protect patients from medical debt, despite five years of growing state legislative activity.
The report, published Aug. 6, examined medical debt laws across the U.S. Medical debt affects an estimated three in 10 U.S. adults, according to the report.
Five things to know:
1. Twenty-one states have set minimum standards for hospital financial assistance eligibility. Five of the 21 states limit assistance to uninsured patients only, leaving many underinsured patients without help. Five states prohibit hospitals from discriminating against immigrant patients when determining eligibility, and 12 set income thresholds that reach patients earning below a living wage.
2. The report found that most state protections don’t apply to bills owed to nonhospital providers, such as ambulance services and physician and dental offices. Separately, few states extend protections to hospital-based clinicians — such as anesthesiologists — who bill independently. Delaware and Colorado were cited as exceptions that extend protections to a broader range of providers.
3. The report found that 19 states collect no data on hospital compliance with financial assistance or collections rules. Maryland was cited as a state that publicly reports hospital-level data with some demographic detail. Just a handful of states, including Delaware and New Mexico, give patients a private right of action against hospitals or debt collectors.
4. The report flagged unregulated use of artificial intelligence in billing and collections, noting no state law currently requires disclosure or oversight of automated tools used to screen patients for charity care or route accounts to collections.
5. The report’s authors said that states can strengthen existing protections by broadening eligibility and provider scope, simplifying application processes and increasing enforcement resources.
Read the full report here.
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