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South Dakota House kills bill that would have stopped medical debt from being included in credit reports

The Context of the Bill

House Bill 1058 was introduced in the South Dakota legislature with the intention of protecting patients from the negative impact of medical debt on their credit scores. The bill aimed to shield patients from the consequences of unpaid medical bills by prohibiting medical providers from reporting these debts to credit reporting agencies.

The Problem of Medical Debt

  • Medical debt is a significant concern in the United States, with millions of Americans struggling to pay their medical bills. The high cost of healthcare, combined with the lack of affordable insurance options, has led to a rise in medical debt. This debt can have serious consequences, including damage to credit scores, delayed medical treatment, and even bankruptcy. ## The Proposed Solution*

    • The Proposed Solution

    The proposed solution to this problem is to bar medical providers from reporting unpaid medical bills to credit reporting agencies. This would prevent patients from having their credit scores negatively impacted by medical debt.

    How the Bill Would Work

  • Medical providers would be prohibited from reporting unpaid medical bills to credit reporting agencies. Patients would still be required to pay their medical bills, but they would not be penalized for non-payment. The bill would not address the underlying causes of medical debt, but rather provide a temporary solution to mitigate its impact. ## The Impact of the Bill*

    • The Impact of the Bill

    The impact of House Bill 1058 would be significant. By prohibiting medical providers from reporting unpaid medical bills to credit reporting agencies, the bill would provide a temporary reprieve for patients struggling with medical debt.

    Potential Benefits

  • Patients would be able to focus on their health rather than worrying about the impact of medical debt on their credit scores. Medical providers would be incentivized to work with patients to develop payment plans and negotiate reduced rates.
  • Some of the bill’s supporters argued that it would have helped reduce medical debt by limiting the hospital’s ability to send bills to collection agencies.**

    • The Problem of Medical Debt

    Medical debt is a significant issue in the United States, with many individuals struggling to pay their medical bills. According to a report by the Kaiser Family Foundation, in 2020, 43% of adults in the US had medical debt, with the average debt per person being around $1,300. This debt can lead to financial hardship, stress, and even bankruptcy. *Some of the most common causes of medical debt include:**

  • High medical bills due to unexpected illnesses or injuries
  • Lack of health insurance or inadequate coverage
  • Rising healthcare costs and inflation
  • Difficulty paying bills due to financial constraints

    • The Proposed Solution

    House Bill 1210 aimed to address the issue of medical debt by limiting when hospitals could send bills to collection agencies. The bill would have restricted hospitals from sending bills to collection agencies for debts that were 120 days or older.

    HB 1058A now goes to the full House. Story courtesy of the South Dakota Broadcasters Association.

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