Medical Debt is Top of Mind for Law Makers and Law Enforcers

March 14, 2022
By Joann Needleman

An Apple a Day Might Keep the Doctor Away, But Medical Debt is Top of Mind for Law Makers and Law Enforcers …

For companies providing revenue cycle services to healthcare providers – services including coding, billing, collections, extended business office or outsourced business or patient support services, this is an important time to review and update your compliance management system and internal auditing and monitoring.  During the pandemic we saw state and federal agencies suppressing debt collection activities due to the public health emergency and the hardships consumers suffered.  Now that pandemic restrictions are easing, state and federal lawmakers and regulators are working to assess how to best help Americans recover without further burdening the economy or businesses.

Healthcare Challenges at the State Level

Healthcare debt is among some key focal points as the pandemic eases (we hope) and it has drawn lawmakers’ and regulators’ attention.  There are a myriad of legislative, enforcement and regulatory activities at the state and federal level zeroed in on different approaches to healthcare debt and the resolution of it.  At the state level fueled in part by a well-timed initiative by the National Consumer Law Center (the “NCLC”) begun in early 2019, states have enacted and continued to consider medical debt protection laws that restrict various debt collection, debt buying and legal debt collection activities.  See,

Healthcare Challenges at the Federal Level

Meanwhile, at the federal level, the Federal Trade Commission (“FTC”) passed a resolution in July 2021, to focus its enforcement efforts, among other things, on healthcare businesses and whether or not they are engaging in unfair, deceptive or other practices and “to determine the appropriate action or remedy, including whether monetary relief would be in the public interest.”  See, FTC Resolution, File No. P210100.  More recently, the Consumer Financial Protection Bureau (“CFPB”) released a bulletin related to the No Surprises Act and debt collection and more recently a report discussing medical debt in consumers’ credit files.  See, Bulletin 2022-01, released January 13, 2022 and CFPB Report, “Medical Debt Burden in the United States,” at

A month ago, the Department of Veterans Affairs also announced some changes designed to reduce financial distress for veterans by requiring all other methods of debt collection to be exhausted before a veteran’s bill is reported to credit reporting agencies.  See,


What does all this mean for credit and collections companies and what steps should be taken?  To follow are five recommendations:

1) Update Your Policies and Procedures.

Update your financial assistance, hardship, repayment, and other policies and procedures after meeting with your healthcare clients to assure you are in sync.  Your strategies should align both with applicable state laws and also with your healthcare clients updated and revised programs in these areas.  The No Surprises Act and several state and federal laws require you to be aware of what debt is incurred related to COVID-19 related care and treatment as well as emergency services.

2) Tune Up Training and Patient-facing Activities.

Consider your patient problem solving activities, including compliance and training programs to assure they are focused on helping patients solve any challenges they have around medical debt and understanding what challenges and obstacles they may face.  Whether your patient facing staff members are working remotely or are back in a work site or a hybrid combination, it is critical to assure your programs reflect what some people call the new normal.  Make certain that you review, log, investigate and respond to all consumer complaints, regardless of how you may receive them and track and trend them as part of your continuous improvement program.

3) Evaluate Your Opportunities for Consumers to Digitally Engage and Self-service.

While people were quarantining during the pandemic, they had many opportunities to use the internet, portals and other online resources in lieu of snail mail and other communication methods.  Are you digitally open for business 24/7 if consumers want to engage with you or self-service “after hours”?

4) Review Your State Registrations and State Licensing.

Some states have relaxed their branch or other rules about having some portion of collections operations conducted from home.  This creates opportunities to hire remote staff in a wide range of states.  Be certain to check with experts like Cornerstone Support about any licensing, bonding or registration requirements that may come along with having employees in new locations.

5) Expect Enforcement and Supervision.

If and as the day comes when you receive a regulator’s supervision or investigation request, including a civil investigative demand from a state regulator or law enforcer or the FTC or CFPB, review it carefully and familiarize yourself with all of the procedural instructions related to it.  Take any and every deadline seriously and be sure to schedule a time to meet and confer with the regulator or law enforcer to verify all of your interpretations of each component of any request.  If necessary, evaluate exactly what will be involved in responding to any law enforcer’s or regulator’s requests and assess what time and resources will be involved in gathering all the information the law enforcer or regulator is requesting.  If you are able to document your challenges, system constraints, and other demonstrable burdens, consider whether you want to request an extension on some of the key deadlines and document and submit that request.  A side note, if email is your system of record for tracking and communicating about your compliance challenges it is important to understand that it may be subject to supervisory or enforcement review and a database or software application for tracking all of your key compliance activities may ultimately prove to be a less burdensome way to not only keep an eye on all your compliance but to demonstrate it to a regulator.





Joann Needleman

Practice Leader & Member
| Clark Hill PLC
Joann Needleman leads the firm’s financial services regulatory and compliance practice and advises banks, financial institutions, and financial services entities on regulatory compliance matters. Joann prepares and represents these same financial institutions during state and federal supervisory examinations and regulatory investigations before agencies such as the Consumer Financial Protection Bureau (CFPB), Federal Trade Commission (FTC) and the Office of the Comptroller of Currency (OCC) as well as state financial services regulators and attorneys general. A former member of the Consumer Financial Protection Bureau’s (CFPB) Consumer Advisory Board, Joann provides her clients with useful strategies and common-sense solutions in order to prepare for areas of regulatory scrutiny.