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Senate OKs bill targeting predatory medical debt collectors

March 9, 2020 GMT

BOISE, Idaho (AP) — Legislation in Idaho to create transparency in medical bills sent to people and to rein in predatory medical debt collectors headed to the governor’s desk on Monday.

The Senate voted 32-1 to approve the measure backers call consumer protection legislation.

Republican Gov. Brad Little has been touting cutting rules and regulations in the state since he took office a little over a year ago. His spokeswoman, Marissa Hyer, declined comment on whether Little will sign the bill into law because she said he does not comment on pending legislation.

If Little signs the bill, the law would take effect on Jan. 1.

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The bill seeks to cap attorney fees charged to former patients at $350 for those who do not contest their bills in court and $750 for those who do. It would also set a 45-day deadline for medical facilities to get bills to peoples’ insurance providers.

“There are loopholes in the law that allow the exploitation of Idahoans,” Republican Sen. Kelly Anthon told senators. “Idaho law should make sure that information is made available to patients, and that patients are given a fair chance to make the payment.”

It’s unusual for legislation that adds regulations on industry to advance in the conservative Idaho Legislature that has super-majorities of Republicans in the House and Senate.

“Clearly there’s a problem in this area with the way our current law is, but I just can’t resolve in my mind that this is the lightest touch that we can do to fix this problem,” said Republican Sen. Steve Vick, the lone vote against the bill in the Senate.

Making the situation even more unusual, one of the medical debt collectors is another lawmaker. Republican Rep. Bryan Zollinger is listed as a manager of Idaho Falls-based Medical Recovery Services.

Zollinger has said the legislation will result in people who pay their bills seeing increases in medical costs because they will also have to pay the bills of those who don’t when medical providers pass on those expenses.

Billionaire Frank VanderSloot, the founder of Idaho Falls-based wellness shopping club Melaleuca, helped initiate the legislation after a debt collection agency targeted one of his employees, tacking on legal fees that he said turned a $294 bill into about $5,500.

He also said he spent $1 million in legal fees defending more than 200 people who he said appear to have been caught up in predatory medical billing by attorneys. Many of those cases involved Medical Recovery Services.

“Knowing these folks, I think they’re going to step it up. I don’t think they’re going to back down,” VanderSloot said after the Senate vote.

He said he hoped judges would consider the dollar limits in the legislation when deciding cases this year between now and Jan. 1 if Little signs the bill into law.