Sponsors (19)
The bill substantially reduces medical debt burdens and limits aggressive hospital collection practices for low- and middle-income Americans while increasing transparency and funding for debt-relief, but it shifts costs and administrative burdens onto hospitals—especially small and rural providers—and concentrates relief funding in ways that may leave some people or places underserved.
Low-income and middle-income patients (up to 400% FPL or with medical bills ≥5% of MAGI) and uninsured people will see large parts of hospital medical debt eliminated or protected from aggressive collections (e.g., no wage garnishment or home foreclosure), reducing household debt and improving credit prospects.
Low-income patients (≤250% FPL) cannot be charged interest and their hospital debt cannot be sold to collectors, lowering ongoing financial burden for the poorest patients.
Patients (especially uninsured and those with chronic conditions) will get clearer, earlier access to charity care and an appeal process because hospitals must screen, publish eligibility rules, decide at least 30 days before payment is due, and accept income documentation.
Hospitals will incur new compliance and administrative costs and face civil money penalties (up to $1M), costs which could be passed on to patients through higher prices or reduced services.
Smaller and rural hospitals may struggle with the administrative burdens (screening, appeals, IT portal reporting, audits), risking reduced services or closures in vulnerable communities.
Limits on selling or assigning hospital debt and caps on repayment obligations could reduce hospitals' ability to recover unpaid bills, tightening budgets for uncompensated care and possibly straining local health systems.
Based on analysis of 3 sections of legislative text.
Adds Medicare hospital rules limiting certain medical‑debt collection, requires charity care policies, and creates a $100M grant program to buy/discharge qualifying medical debt.
Requires hospitals that participate in Medicare to adopt and follow specific charity care and financial-assistance policies, limits certain medical‑debt collection practices (including prohibiting liens on homes and wage garnishment), and authorizes civil monetary penalties for noncompliance; these Medicare conditions take effect January 1, 2028. Creates a Medical Debt Relief Grant Program through HHS to award up to one eligible nonprofit funds to acquire and discharge qualifying medical debt, defines eligible individuals by income or debt burden, and authorizes $100 million for FY2027.
Introduced February 10, 2026 by Gabriel Vasquez · Last progress February 10, 2026