Senate Finance Staff Recommends FDCPA for Hospitals

The Republican staff of the U.S. Senate Committee on Finance released a report late Thursday recommending that the collection practices of non-profit and government hospitals should be covered by the Fair Debt Collection Practices Act, and that an investigation should be conducted on banning certain debt collection practices for medical debt.

The staff recommended the development of standards for medical debt collection, whether done by internal hospital billing and collection staff or by external third-party debt collection agencies. The staff concluded that internal collectors in hospitals should abide by the FDCPA.

The report includes a call for comment on which debt collection practices should be altogether banned when going after medical debt, and suggests that such practices as wage garnishing, bank account seizure, and placing liens on homes are on the table for explicit banning.

The report, titled “Tax-Exempt Hospitals: Discussion Draft,” was released by the ranking Republican member of the Senate Finance Committee, Chuck Grassley of Iowa. The report was released to “encourage and foster additional discussion as the Finance Committee continues to consider possible legislative reform in this area,” according to the introduction in the report.

The bulk of the report focused on specific requirements non-profit hospitals must adhere to in order to retain their tax-exempt status.