How Ohio lawmakers seek to address medical debt

COLUMBUS, Ohio (WCMH) -- Medical debt is the number one reason that people in the United States file for bankruptcy, and for many, like cancer survivor Olivia Hiltbrand, medical bills hit at the most unexpected times.

“I was unprepared for anything like that to happen,” she said. “I went through chemotherapy, brain radiation, all kinds of medications, pills, just anything you can think of for those three years.”

Hiltbrand said she got diagnosed with T-cell acute lymphoblastic leukemia/lymphoma in 2020, when she was 31 years old. She said she was otherwise healthy, so this came as a shock. Still, she and her husband had insurance, full-time jobs and health savings accounts.

“Essentially, we were doing what we thought responsible adults who had income could do,” Hiltbrand said.

At the start of her treatment, Hiltbrand said she had a three-week hospital stay. After that, she got a bill for her insurance for $200,000.

“Sticker shock would be a good way to put it,” she said. “The cost of the treatment was incomprehensible. I didn’t understand how it could cost that much just to keep me alive.”

Hiltbrand said that when she was not going through chemotherapy, she was on the phone, making sure she had proper payment plans lined up. She said she still owes about $7,000, two years after being cancer-free. Even through that, Hiltbrand said she considers herself one of the lucky ones because her hospitals do not charge interest on her bills.

“It would’ve been incredibly stressful to me, even more than it already was, to have interest piling up on these bills that I already couldn’t pay,” she said.

Now, a new bill, known as the Medical Debt Fairness Act, could help alleviate some of that burden.

If passed, the bill would do three things:

• Cap interest rates on medical debt at 3%,
• Prohibit reporting medical debt to credit agencies,
• And ban wage garnishment for medical debt.

“This policy overreaches and so the consequence, it could harm some of the very people it's trying to help,” Vice President of Policy at the Buckeye Institute, a conservative-leaning think-tank, Rea Hederman said.

Hederman said the bill could result in higher prices for everyone else if interest rates on medical bills are so low that Ohioans feel they can move those payments to the back of the line.

“You could see co-payments going up, your deductibles going up as companies and healthcare providers don't want to put themselves at financial risk for providing bad debt,” Hederman said.

He said this will also open the door for people who can’t afford it to get new loans.

“If you don't know if somebody has a large package of debt on their bills, then other areas of financing, from houses to car loans, may become less transparent, so people could be at greater risk of bankruptcy or default,” Hederman said.

Hederman added that if providers cannot go after someone’s income in order to recuperate costs, then it may have to become more extreme.

“A lot of times, where are you going to be looking? To repossess a car, trying to go to a court case to find out other assets they may have,” Hederman said. “That's going to make it a lot more expensive to make these loans.”

Overall, Hederman agreed that something needs to be done, but said this is bad policy for the state.

“At the end of the day, the question can be, ‘How can we make healthcare more affordable for a lot of these people?’” he said.

“You shouldn’t have to be fighting for your life and also dealing with the effects of this debt,” Hiltbrand said.

As far as hospitals go, two answered a request for their stance on it.

The Cleveland Clinic said it has not taken a position “since it doesn’t impact our operations.”

“Cleveland Clinic offers financial assistance to patients who qualify,” a spokesperson wrote. “If a patient does not qualify, we offer no-cost payment plans for up to four years. We do not garnish patients' wages, place liens on patients' homes, or report debt to credit agencies.”

The Ohio State University Wexner Medical Center said it is reviewing the bill and directed comments to the Central Ohio Hospital Association and the Ohio Hospital Association.

The bill did just have its first hearing, but sponsors said they have talked with leadership and are confident the bill will gain traction. Nearly one-third of Ohio House members, both Republicans and Democrats, are signed on in support.