Nine months after Sharon Cravitz underwent a double mastectomy as part of her breast cancer treatment, she received a bill for $2,000 from a company she did not recognize.
When she called the provider, they told her to file a complaint with the Colorado Department of Regulatory Affairs to pressure her insurance company to pay the supposedly outstanding fee.
Cravitz realized after some digging, however, that her insurance correctly paid the surgical assistant in question, and she should not owe any money.
She then received a letter from a debt collector over the $2,000, threatening a blow to her financial record if she did not pay up.
“This drags on for almost a year, sucking my time and my energy and at times bringing me to my knees in stress and dismay,” she said during a Tuesday press conference. “I was being victimized by unethical and baseless financial threats at an extremely vulnerable time.”
Cravitz put together a written explanation to the debt collector, asserting that the threats felt like harassment and fraud, and the financial pursuit stopped.
Now, Colorado lawmakers want to put stronger consumer protections in place for people with medical debt – either legitimate or predatory and illegitimate – to avoid situations like the one Cravitz, and countless other people, have gone through.
They say a multipronged bill will set guardrails for providers and insurers to follow and reduce the impact medical debt has on people.
“Medical debt is crushing hardworking families in Colorado,” said bill sponsor Sen. Lisa Cutter, a Littleton Democrat. “It stops them from saving for college or retirement, forces them into taking second, third or even fourth jobs and limits their ability to live the American dream.”
Senate Bill 23-93 would cap the medical debt interest rate in the state at 3%, down from 8%, following an example supported by Arizona voters last fall.
The bill would also mandate a pause on debt collection efforts as patients appeal their coverage, require debt collectors to provide a payment plan, and require health care providers to give cost estimates to patients who intend to pay for a service themselves. The final cost of the service must then be no more than 15% higher than the estimate, barring unforeseen emergencies.
“This bill will require good-faith estimates of how much medical services will cost, helping ensure that patients actually understand their health care costs,” said co-sponsor Sen. Sonya Jaquez Lewis, a Longmont Democrat. “It will allow patients to make informed decisions when it comes to planning for those payments.”
The Consumer Financial Protection Bureau estimates that nationwide there is about $88 billion in medical debt on consumer credit records. In Colorado, it is estimated that 12% of people have medical debt in collections, with a median debt of $748.
“It is fair to say that the level of medical debt is rising,” Attorney General Phil Weiser said. “The fact that it is the most common form of debt being put on people’s credit reports is concerning.”
Bill sponsors say SB-93 builds on previous work by the Legislature, including a 2022 measure that prevents Colorado hospitals from collecting medical debt if they don’t provide accessible pricing information to a patient.
Along with Cutter and Jaquez Lewis, the bill is sponsored by Rep. Mike Weissman, an Aurora Democrat. It is set to be considered in the Senate Health and Human Services Committee on Feb. 23.
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