Hospitals must notify the state before closing or ending services

Hospitals must give the state written notice before certain closures or service endings. This applies when a hospital permanently ends all operations or completely ends a category of hospital services for more than 90 days. Examples include emergency, maternity, newborn, trauma, and behavioral health care. The state may waive notice requirements if the hospital asks and the closure or service ending is needed because of an emergency beyond its control, or the state finds a waiver needed to protect public health and safety. The hospital must give notice at least 60 days before the closure or service ending. Within 10 days after notice, the state must post a summary and notify affected agencies.

Hospitals and collectors working for them may collect covered medical debt only if the hospital follows specified state requirements. Medical debt means an amount at least 120 days overdue for health care services, products, or devices provided to an individual by or in a hospital. The rule excludes debt purchased by, payable to, or owed to a financial institution or its assignee. The state department reviews compliance twice a year. After a final finding of noncompliance, the attorney general may suspend collection authority unless the hospital has a pending review. The hospital may resume collecting previously incurred debt after the state confirms it has fixed the problem and is compliant. The chapter applies to medical debt incurred after June 30, 2026. A person may raise noncompliance as a defense in a collection case during a period of noncompliance after a final state finding.

The attorney general may investigate violations and take enforcement steps; people injured by a violation may sue. These enforcement powers and court remedies concern violations of the medical debt collection chapter. The attorney general may impose a civil penalty of up to $10,000 per violation, order repayment to an affected person, or suspend or prohibit collection until compliance is verified. A person injured by a violation may sue for actual damages, statutory damages up to $1,000, or a court order to stop the violation.