Hoosier medical debt tops $2 billion. A bill offering some relief just passed the Senate

Added support for people with medical debt could come through a measure at the statehouse.

Similar legislation has been put forward by Democrats for years but is now receiving Republican support as well. 

Medical debt in Indiana reportedly tops $2-billion, with one in five residents having debt currently in collections. 

Ed Charbonneau’s (R-Valparaiso) bill is aimed at creating guardrails around medical debt to make sure Hoosiers know what resources are available to them. The bill requires hospitals to offer payment plans to people who meet certain income guidelines. 

“All we’re trying to do here is make sure they get paid by working out a payment plan,” he said.

Charbonneau acknowledged that most hospitals have payment plans - but said many people don’t know about them. 

“That information is on page 55 of 100 pages of documents when they check out of the hospital,” he said. “They aren’t going to see that payment plan.”

The bill also prohibits liens against a person's home as a consequence of medical debt and creates guardrails around the garnishment of wages. 

Specifically, wages cannot be garnished for someone making 200% or less of the federal poverty line - roughly $31,000 annually for an individual. Those making more than 200% can only have 10% of their weekly wages garnished. 

Charbonneau repeatedly stressed the bill would not stop hospitals from getting paid. 

“It does not remove the obligation for the patient to pay the bill,” he said. “The bill does not prevent a debt collector from filing a lawsuit against the patient.”

Fady Qaddoura (D-Indianapolis) has worked for years to get a bill like this one passed. On the bill’s passage he thanked the measure’s many supporters and advisors over the years. 

“1.2 million Hoosiers hopefully will be positively impacted over the next few years by such legislation in every district in every zip code across Indiana,” he said. 

Democrats identified medical debt as one of their key issues coming into this legislative session. 

Contact Government and Health Reporter Benjamin Thorp at bthorp@wfyi.org