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The Patient Debt Relief Act establishes financial assistance and medical debt collection standards for hospitals participating in Medicare, effective January 1, 2026. Hospitals must adopt charity care policies with publicly available eligibility requirements, screen patients for assistance before collection, and provide 30-day notice before seeking payment. The bill prohibits hospitals from placing liens on homes, garnishing wages, or selling debt to collectors for patients earning up to 250% of the poverty line, and limits debt sales to cases where patients miss four consecutive payments on a repayment plan capped at 4% of gross monthly income. Additionally, the bill establishes a federal grant program to fund a nonprofit organization to acquire and discharge medical debt for eligible individuals whose medical debt exceeds 5% of their income.
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