News & Resources

Hospital billing practices may affect Colorado consumers, collectors

May 09, 2012 Philip Burgess

Debt caused by overdue medical bills affects millions of Americans every year and is one of the major contributing factors keeping the debt collection industry busy. New developments in life saving technology means that use of these tools is a much larger expense, and many people have trouble keeping up with payments. When medical debt is incurred, many former patients aren't cleared to work, which can drive consumers further into debt if they do not have a large amount of savings in an emergency fund. So when payment plans become overwhelming, it can sometimes be easier to just default and work out a plan with a collector, though a new law may help consumers and adversely affect agencies. Colorado changes state law Senate Bill 12-134 was recently passed by both the state House of Representatives and Senate and is expected to receive the governor's signature in the near future, Health Policy Solutions reported. The law will require hospitals in Colorado to give a discount to uninsured patients with a family income of no more than 250 percent of the national poverty level and do not take advantage of Colorado's indigent care program. Each hospital must also explain that this option is available to patients so they know they have options, even if they do not believe they make enough money to cover a procedure. Senator Irene Aguilar told Health Policy Solutions that costs of medical procedures for the uninsured can soar to over 495 percent of the original cost and 842 percent of an outpatient service. Effect on debt collectors Debt collectors in Colorado may want to follow the news on this law, because the new regulations will have a direct effect on their industry. Section 4, Part B of Senate Bill 12-134 mandates that hospitals must not declare an account delinquent for at least 30 days after a missed bill, as long as it is the first time a payment was absent. Medical debt affects many The 2011 Colorado Health Access Survey found that many Coloradans can reap the benefits of the passage of this law. The survey reported there are 829,000 citizens who do not have health insurance in the state, which represents an increase of nearly 200,000 in the number of uninsured Colorado inhabitants over the last two years. Many people, especially in Colorado, cite the high cost of premiums as the main factor they do not have a health insurance policy.