Bill targeting predatory medical debt collectors advances

Legislation intended to create transparency in medical bills sent to patients and to rein in predatory medical debt collectors advanced to the Idaho House on Wednesday.

The House Business Committee approved the bill 15-2 after a five-hour, emotional hearing where lawmakers shared personal stories.

The measure would require doctors and medical facilities to provide timely and clear bills for their clients. It would also limit how much attorneys can get paid in specific circumstances involving medical debt collection.

Specifically, the bill seeks to cap medical collection debt fees at $350 for people who do not contest their bills and $750 for those who do. It would also set a 45-day deadline for medical facilities to get consolidated bills to patients.

Idaho billionaire Frank VanderSloot, founder of wellness shopping club Melaleuca, helped initiate the legislation after a debt collection agency targeted one of his employees, tacking on legal fees that turned a $294 medical bill into a $5,500 bill. He’s also spent $1 million in legal fees defending people who he said appear to have been caught up in predatory medical billing by attorneys.

“Clearly, our state legislators, representatives, have heard the call of the people,” he said after the vote. “There are several who have had experiences themselves. And I’m glad to see they’re wanting to do the right thing for the people, even though one of their colleagues is involved here. The circumstances are extraordinary in this case.”

Republican Rep. Bryan Zollinger, manager of Medical Recovery Services, addressed the committee, arguing against the legislation.

“I think the goal of everybody on this committee is the same — medical billing transparency, reduce the cost of collections,” he said. “I think there’s a way to do that in a much less restrictive way that would not fly in the face of conservative government.”

Republican Rep. Jason Monks, the Legislature’s assistant majority leader and Zollinger’s friend, argued in favor of the bill. He said nobody was breaking the law with medical debt collection, that in some instances led to large bills that included attorney fees dwarfing the original medical costs.

“The current law allows for the situations that we’re dealing with right now,” he told the committee. “I think the current law in my opinion is unjust and unfair. I think the law takes advantage of individuals and that’s why we need to change this.”

Those who testified consisted of patients who said they were taken advantage of after getting caught up in medical billing. Several attorneys and doctors opposed the measure, saying it would protect deadbeats and let costs get passed onto other patients, or it would lead to patients being forced to pay entire costs up front.

The Idaho Medical Association is neutral on the bill, Monks said, after lawmakers made several changes to the initial legislation.

Republican Rep. Gayann DeMordaunt made a motion to send the bill to the House floor with a do-pass recommendation, getting near tears in talking about her personal experiences.

The bill survived two other measures that could have killed it. One involved sending it to the House floor with no recommendation, and the other involved holding it for changes.

The motions were withdrawn after discussion made it clear a majority of the lawmakers wanted to approve the measure.