North Carolina 2021-2022 Session Status: Died Bipartisan · 14 R · 11 D cosponsors

HB 1039 — Medical Debt De-Weaponization Act.

Last action — Passed 1st Reading

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  1. ✓
    Introduced
  2. ✓
    In Committee
  3. Died in session

This bill died with 2021-2022 Session. It reached “In Committee” and never advanced before the session ended, so it can no longer move — a new version would have to be reintroduced in the current session.

This bill is no longer active — its legislative session has ended, so there is no live prognosis. It would have to be reintroduced in the current session to move again.

Bill Text

What changed in the latest version

522 added · 520 removed

Plain-language change summary

The latest version of House Bill 1039 has removed a specific provision that stated if an individual is deemed eligible for financial assistance, the debt must be returned or recalled by the medical creditor if not paid. This change may impact how medical debts are handled when patients qualify for assistance, potentially leaving room for medical debt buyers to retain debts longer. This can affect patients' financial situations, as they may face increased pressure to pay debts that could otherwise be resolved through financial aid.

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GENERAL ASSEMBLY OF NORTH CAROLINA H.B.
GENERAL ASSEMBLY OF NORTH CAROLINA SESSION 2021 H 1 HOUSE BILL 1039 Short Title:
1039 May 24, 2022 SESSION 2021 HOUSE PRINCIPAL CLERK H D HOUSE BILL DRH40726-NHa-6 Short Title:
Representative Goodwin.
Representatives Goodwin, Hanig, Hunter, and Richardson (Primary Sponsors).
For a complete list of sponsors, refer to the North Carolina General Assembly web site.
A BILL TO BE ENTITLED AN ACT TO ADOPT THE PRO-FAMILY, PRO-CONSUMER MEDICAL DEBT PROTECTION ACT TO SET TRANSPARENT PARAMETERS AROUND THE PROVISION OF FINANCIAL ASSISTANCE FOR IMPOVERISHED FAMILIES AND LIMIT THE ABILITY OF LARGE MEDICAL FACILITIES TO CHARGE UNREASONABLE INTEREST RATES AND EMPLOY UNFAIR TACTICS IN DEBT COLLECTION, AS REQUESTED BY THE NORTH CAROLINA DEPARTMENT OF STATE TREASURER.
Banking, if favorable, Health, if favorable, Rules, Calendar, and Operations of the House May 26, 2022 A BILL TO BE ENTITLED AN ACT TO ADOPT THE PRO-FAMILY, PRO-CONSUMER MEDICAL DEBT PROTECTION ACT TO SET TRANSPARENT PARAMETERS AROUND THE PROVISION OF FINANCIAL ASSISTANCE FOR IMPOVERISHED FAMILIES AND LIMIT THE ABILITY OF LARGE MEDICAL FACILITIES TO CHARGE UNREASONABLE INTEREST RATES AND EMPLOY UNFAIR TACTICS IN DEBT COLLECTION, AS REQUESTED BY THE NORTH CAROLINA DEPARTMENT OF STATE TREASURER.
§ 1133, a Medicare appeals process, a Medicaid appeals process, or another applicable appeals process.
§ 1133, a *H1039-v-1* General Assembly Of North Carolina Session 2021 Medicare appeals process, a Medicaid appeals process, or another applicable appeals process.
*DRH40726-NHa-6* General Assembly Of North Carolina Session 2021 (4) Extraordinary collection action.
(4) Extraordinary collection action.
– A covered health care provider's full, established price for health care services that the covered health care provider charges uninsured patients before applying any contractual allowances, discounts, or deductions.
– A covered health care provider's full, established price for health care services that the covered health care provider charges uninsured patients before applying anycontractual allowances, discounts, or deductions.
b.
Page 2 House Bill 1039-First Edition General Assembly Of North Carolina Session 2021 b.
Page 2 DRH40726-NHa-6 General Assembly Of North Carolina Session 2021 d.
d.
– Any entity that provides health care services and to whom the consumer owes money for health care services, or the entity that provided health care services and to whom the consumer previously owed money if the medical debt has been purchased by one or more debt buyers.
– Any entitythat provides health care services and to whom the consumer owes money for health care services, or the entity that provided health care services and to whom the consumer previously owed money if the medical debt has been purchased by one or more debt buyers.
– Any person that regularly collects or attempts to collect, directly or indirectly, medical debts originally owed or due or asserted to be owed or due another.
– Any person that regularly collects or attempts to collect, directlyor indirectly, medical debts originallyowed or due or asserted to be owed or due another.
– The person who received health care services, and for the purposes ofthisArticleshallincludeaparentifthepatientisaminor,oralegalguardian if the patient is an adult under guardianship.
– The person who received health care services, and for the purposes ofthisArticleshallincludeaparentifthepatientisaminor,oralegal guardian if the patient is an adult under guardianship.
(3) The eligibility criteria for financial assistance and a summary of the type of assistance that is available as set forth in this Article.
House Bill 1039-First Edition Page 3 General Assembly Of North Carolina Session 2021 (3) The eligibility criteria for financial assistance and a summary of the type of assistance that is available as set forth in this Article.
DRH40726-NHa-6 Page 3 General Assembly Of North Carolina Session 2021 (5) The information and documentation the large health care facility may require an individual to provide as part of the application.
(5) The information and documentation the large health care facility may require an individual to provide as part of the application.
e.
Page 4 House Bill 1039-First Edition General Assembly Of North Carolina Session 2021 e.
Any amount above ten thousand dollars ($10,000) shall be provided to the patient as free care.
Anyamount above ten thousand dollars ($10,000) shall be provided to the patient as free care.
(3) Patients with household income of more than four hundred percent (400%) up to six hundred percent (600%) of the federal poverty level shall receive the same discounts as patients with household income of more than two hundred Page 4 DRH40726-NHa-6 General Assembly Of North Carolina Session 2021 percent (200%) up to four hundred percent (400%) of the federal poverty level if the patient or the patient's household has incurred medical expenses from the current large health care facility's bill and all other medical bills for medically necessary health care services received during the previous 12 months which in total exceed ten percent (10%) of the household's income.
(3) Patients with household income of more than four hundred percent (400%) up to six hundred percent (600%) of the federal poverty level shall receive the same discounts as patients with household income of more than two hundred percent (200%) up to four hundred percent (400%) of the federal povertylevel if the patient or the patient's household has incurred medical expenses from the current large health care facility's bill and all other medical bills for medically necessary health care services received during the previous 12 months which in total exceed ten percent (10%) of the household's income.
However, if the patient is the subject of collection activity by the facility or amedical debt collector,including alawsuit to collect amedical debt ornegative credit reporting regarding a medical debt, and submits an application for financial assistance, the large health care facility shall accept and process the application at any time.
However, if the patient is the subject of collection activity by the facilityor amedical debt collector,includingalawsuit to collect amedical debt ornegative credit reporting regarding a medical debt, and submits an application for financial assistance, the large health care facility shall accept and process the application at any time.
If the patient submits a financial assistance application to a medical debt collector, the medical debt collector shall forward the application to the large health care facility within two business days and shall cease collection activity until notified by the large health care facility of the outcome of the application and any debt forgiven or new repayment terms.
If the patient submits a financial assistance application to a medical debt collector, the medical debt collector shall forward the application to the large health care facility within two business days and shall cease House Bill 1039-First Edition Page 5 General Assembly Of North Carolina Session 2021 collection activityuntil notified by the large health care facility of the outcome of the application and any debt forgiven or new repayment terms.
DRH40726-NHa-6 Page 5 General Assembly Of North Carolina Session 2021 (g) Large health care facilities and medical debt collectors shall offer to any patient who qualifies for financial assistance a payment plan of not less than 24 months and shall not require the patient to make monthly payments that exceed five percent (5%) of the patient's gross monthly income.
(g) Large health care facilities and medical debt collectors shall offer to any patient who qualifies for financial assistance a payment plan of not less than 24 months and shall not require the patient to make monthly payments that exceed five percent (5%) of the patient's gross monthly income.
Contact [insert name and phone number of large health care facility] for translation assistance," translated in the 10 languages most frequentlyspokenbylimitedEnglishproficienthouseholdsasdeterminedbyU.S.CensusBureau data in the large health care facility's service area.
Contact [insert name and phone number of Page 6 House Bill 1039-First Edition General Assembly Of North Carolina Session 2021 large health care facility] for translation assistance," translated in the 10 languages most frequentlyspokenbylimitedEnglishproficienthouseholdsasdeterminedbyU.S.Census Bureau data in the large health care facility's service area.
Page 6 DRH40726-NHa-6 General Assembly Of North Carolina Session 2021 (b) A large health care facility must accommodate all significant populations that have limited English proficiency by translating the MDMP and application form into the primary languages spoken by such populations.
(b) A large health care facility must accommodate all significant populations that have limited English proficiency by translating the MDMP and application form into the primary languages spoken by such populations.
A large health care facility may determine the percentage or number of limited English proficiency individuals in thelargehealth carefacility's communityorlikely to beaffected orencounteredbythehospital facility.
A large health care facility may determine the percentage or number of limited English proficiency individuals in thelargehealth carefacility's communityorlikelyto beaffectedorencountered bythehospital facility.
(b) No medical creditor or medical debt collector shall engage in any permissible extraordinary collection actions until 180 days after the first bill for a medical debt has been sent.
(b) No medical creditor or medical debt collector shall engage in any permissible extraordinarycollection actions until 180 days after the first bill for a medical debt has been sent.
(c) At least 30 days before taking any extraordinary collection actions, a medical creditor or medical debt collector must provide to the patient a notice containing the following:
(c) At least 30 days before taking anyextraordinarycollection actions, a medical creditor or medical debt collector must provide to the patient a notice containing the following:
(d) A large health care facility or a medical debt collector collecting debt for health care services provided by such afacilityshall not useanyextraordinary collectionactions unless these actions are described in the large health care facility's billing and collections policy.
(d) A large health care facility or a medical debt collector collecting debt for health care services provided bysuch afacilityshall not useanyextraordinarycollectionactions unless these actions are described in the large health care facility's billing and collections policy.
(e) If a large health care facility or a medical debt collector collecting debt for health care services provided by such a facility bills or initiates collection activities and the patient is later found eligible for financial assistance, the large health care facility or medical debt collector shall reverse any extraordinary collection actions, including:
(e) If a large health care facilityor a medical debt collector collecting debt for health care services provided by such a facility bills or initiates collection activities and the patient is later House Bill 1039-First Edition Page 7 General Assembly Of North Carolina Session 2021 found eligible for financial assistance, the large health care facilityor medical debt collector shall reverse any extraordinary collection actions, including:
DRH40726-NHa-6 Page 7 General Assembly Of North Carolina Session 2021 (3) Removing any wage garnishment orders.
(3) Removing any wage garnishment orders.
(b) After the one-year period described in subsection (a) of this section, medical creditors and medical debt collectors must give consumers at least one additional bill before reporting a medical debt to any consumer reporting agency.
Page 8 House Bill 1039-First Edition General Assembly Of North Carolina Session 2021 (b) After the one-year period described in subsection (a) of this section, medical creditors and medical debt collectors must give consumers at least one additional bill before reporting a medical debt to any consumer reporting agency.
The amount reported to the consumer reporting agency must be the same as the amount stated in the bill, and the bill shall state that the debt is Page 8 DRH40726-NHa-6 General Assembly Of North Carolina Session 2021 being reported to a consumer reporting agency.
The amount reported to the consumer reporting agency must be the same as the amount stated in the bill, and the bill shall state that the debt is being reported to a consumer reporting agency.
(c) No medical creditor that knows or should have known about an internal review, external review,orother appealofahealthinsurancedecisionthatispendingnoworwas pending within the previous 60 days shall refer, place, or send the unpaid charges for health care services to a medical debt collector, including by selling the debt to a medical debt buyer.
(c) No medical creditor that knows or should have known about an internal review, externalreview,orother appealofahealthinsurancedecisionthatispendingnoworwaspending within the previous 60 days shall refer, place, or send the unpaid charges for health care services to a medical debt collector, including by selling the debt to a medical debt buyer.
The Office of the State Treasurer shall incorporate a reporting on this interest rate into theinterest matters report required by the Council of State.
The Office of the State Treasurer shall incorporate a reporting on this interest rate into theinterest matters report required bythe Council of State.
This plan shall prominently disclose the rate of any interest being applied to thedebt in compliancewith G.S.
This plan shall prominently disclose the rate of anyinterest being applied to thedebt in compliancewith G.S.
(c) A medical debt payment plan may be accelerated or declared in default or no longer operative due to nonpayment only after the patient fails to make scheduled payments on the payment plan for at least three consecutive months.
(c) A medical debt payment plan may be accelerated or declared in default or no longer operative due to nonpayment only after the patient fails to make scheduled payments on the House Bill 1039-First Edition Page 9 General Assembly Of North Carolina Session 2021 payment plan for at least three consecutive months.
Additionally, notice must be provided in writing that the payment plan may become inoperative DRH40726-NHa-6 Page 9 General Assembly Of North Carolina Session 2021 and informing thepatient oftheopportunity to renegotiatethepayment plan.
Additionally, notice must be provided in writing that the payment plan may become inoperative and informingthepatient oftheopportunityto renegotiatethepayment plan.
Any waiver by any patient or other consumer of any protection provided by or any right of the patient or other consumer under this Article is void and may not be enforced by any court or any other person.
Page 10 House Bill 1039-First Edition General Assembly Of North Carolina Session 2021 Any waiver by any patient or other consumer of any protection provided by or any right of the patient or other consumer under this Article is void and may not be enforced by any court or any other person.
Page 10 DRH40726-NHa-6 General Assembly Of North Carolina Session 2021 (a) The Attorney General shall have the authority to enforce this Article and may adopt any rules it believes are necessary or appropriate to effectuate the purpose of this Article, to provide for the protection of patients and their families, and to assist market participants in interpreting this Article.
(a) The Attorney General shall have the authority to enforce this Article and may adopt any rules it believes are necessary or appropriate to effectuate the purpose of this Article, to provide for the protection of patients and their families, and to assist market participants in interpreting this Article.
DRH40726-NHa-6 Page 11
House Bill 1039-First Edition Page 11
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How this bill changes current law

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AI-generated reading aid from the bill's amendatory text — verify against the official bill.

This bill establishes the Medical Debt Protection Act aimed at limiting unreasonable interest rates and unfair debt collection practices by large medical facilities.

  • Chapter 131E

    This Article shall be known and cited as the "Medical Debt Protection Act." The purpose of this Article is to reduce burdensome medical debt and to protect patients in their dealings with medical creditors, medical debt buyers, and medical debt collectors with respect to such debt. This Article is to be construed as a consumer protection statute and shall be liberally and remedially construed to effectuate its purposes.

    Introduces the Medical Debt Protection Act to safeguard consumers against medical debt challenges.

  • § 131E-214.21

    Definitions apply in this Article: (1) Consumer. – A natural person who has incurred a debt or alleged debt for primarily personal, family, or household purposes. (2) Consumer reporting agency. – Any person, which, for monetary fees, dues, or on a cooperative nonprofit basis, regularly engages in whole or in part in the practice of assembling or evaluating consumer credit information or other information on consumers for the purpose of furnishing consumer reports to third parties.

    Establishes key definitions relevant to the Medical Debt Protection Act.

  • § 131E-214.22

    An extraordinary collection action includes any of the following: a. Selling an individual's debt to another party, except if prior to the sale, the medical creditor enters into a legally binding written agreement with the medical debt buyer which includes provisions prohibiting the medical debt buyer from engaging in any extraordinary collection actions.

    Defines extraordinary collection actions and sets limitations on medical creditors selling debts and the actions that can be taken against patients.

  • § 131E-214.23

    All large health care facilities are required to develop a written medical debt mitigation policy that complies with this Article and any implementing rules.

    Mandates large healthcare facilities to create a medical debt mitigation policy to assist patients.

  • § 131E-214.24

    Large health care facilities must take steps before seeking payment for any emergency or medically necessary care, including determining whether the patient has health insurance and offering screening for public or private insurance eligibility.

    Establishes requirements for healthcare facilities to assist patients in financial hardship before pursuing payment.

Action History

  1. Passed 1st Reading

  2. Ref to the Com on Banking, if favorable, Health, if favorable, Rules, Calendar, and Operations of the House

  3. Filed

Sponsors

Sponsorship breakdown

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3 sponsors · 42 co-sponsors · 134 not signed on

Sponsors (3)

Co-sponsors (42)

Not signed on (134)

134 members have not signed on to this bill.

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"Not signed on" means a member has not sponsored or co-sponsored this bill — it does not imply opposition. Members flagged Voted No have a recorded No vote on this bill.

Whip count is in markup. Polling the chamber and every recorded vote this session. Only the first open is slow. It’s instant for you after this. Calling the roll · Tallying · Engrossing

Subjects

finance healthcare
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Frequently asked questions

Who sponsors HB 1039?
HB 1039 is sponsored by Edward C. Goodwin (Republican), Hanig, Hunter, Richardson, Adcock, Alexander, Autry, Cynthia Ball (Democratic), Mary Belk (Democratic), John R. Bell, IV (Republican), Boles, Deb Butler (Democratic), Becky Carney (Democratic), Allison A. Dahle (Democratic), Jimmy Dixon (Republican), Faircloth, Garrison, Gill, Dudley Greene (Republican), Harris, Pricey Harrison (Democratic), Hurley, Hurtado, Insko, Keith Kidwell (Republican), Carolyn G. Logan (Democratic), Lucas, McElraft, Jeffrey C. McNeely (Republican), McNeill, Marcia Morey (Democratic), Howard Penny, Jr. (Republican), Ray Pickett (Republican), Mark Pless (Republican), Robert T. Reives, II (Democratic), Rudow, Sasser, Brian Turner (Democratic), Harry Warren (Republican), Zachary, Jeff Zenger (Republican), Sarah Stevens (Republican), Ben T. Moss, Jr. (Republican), Joe John (Democratic), and Mike Clampitt (Republican).
What is the current status of HB 1039?
This bill died with 2021-2022 Session. It reached “In Committee” and never advanced before the session ended, so it can no longer move — a new version would have to be reintroduced in the current session.
Where can I track HB 1039?
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