Lawmakers in at least eight states this year are aiming to reel in wage garnishment for unpaid medical bills.
The legislation introduced in Colorado, Florida, Hawaii, Indiana, Maine, Michigan, Ohio, and Washington builds on efforts made in other states in past years. This latest push for patient protections comes as the Trump administration has backed away from federal debt protections, health care has become more costly, and more people are expected to go without medical coverage or choose cheaper but riskier high-deductible insurance plans that could lead them into debt.
“In the wealthiest country on Earth, people are going bankrupt, suffering wage garnishment, just because they get sick,” said Colorado state Rep. Javier Mabrey, a Democrat who introduced legislation on Feb. 19 that would, among other measures, ban wage garnishment for medical debt.
That legislation is under consideration after a KFF Health News investigation found that courts approved wage garnishment requests in an estimated 14,000 medical debt cases a year in Colorado. The investigation also showed that it isn’t just urban hospitals or big health care chains allowing their patients’ wages to be garnished. It’s also small rural hospitals, physician groups, and public ambulance services, among other medical care providers. And the reporting showed that wage garnishment can erroneously target patients. For example, one family lost wages — and subsequently power to their home, because they couldn’t pay their electric bill — after an ambulance company incorrectly billed the family instead of Medicaid.
Wage garnishment is one tool creditors can use in most states to recoup money from people with unpaid bills. In many states, they can garnish someone’s bank account or put a lien on their home, too. To garnish a person’s wages, a creditor must typically get permission from a court to make the person’s employer hand over a piece of the debtor’s earnings.
“The creditor is taking the money directly out of somebody’s paycheck, and so it doesn’t leave people with any choice to say, ‘I need to prioritize food for my children,’” said Lauren Jones, legal and policy director for the National Center for Access to Justice. The center, based at Fordham Law School, scores states and the District of Columbia on how fair their laws are to consumers who get sued over debt.
It is legal to garnish patients’ wages for medical debt in all but a few states, according to the Commonwealth Fund, a nonprofit foundation based in New York focused on healt …