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- 83rd Session (2025)
Assembly Bill No. 204–Assemblymember Carter
CHAPTER..........
AN ACT relating to medical debt; prohibiting certain actions by
certain entities that provide health care and collection
agencies to collect a medical debt; providing requirements for
engaging in extraordinary collection actions to collect a
medical debt; and providing other matters properly relating
thereto.
Legislative Counsel’s Digest:
Existing law provides requirements governing the collection of medical debt by
a collection agency, including a requirement to provide certain notice to a medical
debtor before taking action to collect and prohibiting certain actions to collect a
medical debt. (NRS 649.366, 649.368)
Sections 14 and 19 of this bill prohibit a health care entity or collection agency
from engaging in certain actions, or threatening to engage in certain actions, to
collect a medical debt, including: (1) causing the arrest of a consumer; (2) obtaining
a lien or foreclosing on real property of a consumer that includes the consumer’s
primary residence; (3) garnishing any refund of federal income taxes due to a
consumer; or (4) garnishing, attaching or seizing the bank account of a consumer.
Section 15 of this bil l prohibits a health care entity or collection agency from
engaging in extraordinary collection actions until at least 180 days after the first bill
for a medical debt is sent to a consumer and requires a notice that includes certain
information to be sent to the consumer at least 30 days before any extraordinary
collection action is taken. Section 6 of this bill defines the term “extraordinary
collection action” to mean: (1) selling a medical debt to a collection agency; (2) any
action that requires a lega l or judicial process except for placing a lien on third
party settlements; (3) reporting, furnishing or threatening to report or furnish any
information regarding a medical debt to a consumer reporting agency; or (4)
garnishing or threatening to garnish t he wages of a consumer. Section 15 prohibits
a health care entity or collection agency from engaging in extraordinary collection
actions when there is a state of emergency, declaration of disaster or public health
emergency or other health event in the county in this State in which a consumer
resides and tolls any statute of limitations applicable to a claim to recover on a
medical debt during the same period. If the state of emergency, declaration of
disaster or public health emergency has been d eclared pursuant to federal law,
section 15 limits the duration of the prohibition on extraordinary collection actions
to 6 months after the effective date of the declaration of emergency or disaster.
Section 16 of this bill provides additional requiremen ts for the collection of
medical debts incurred for medical services, medical products or medical devices
provided by a health care entity, including: (1) a prohibition on engaging in
extraordinary collection actions unless such actions are described in th e billing and
collection policy of the health care entity; (2) a requirement to reverse any
extraordinary collection actions if it is determined that the consumer is eligible for
financial assistance that eliminates or would have eliminated the debt; and ( 3)
requiring a consumer to be refunded within 60 days if, after the application of any
financial assistance, a consumer had paid an amount in excess of the amount of the
medical debt.
Section 17 of this bill provides that the protections provided by sections 13-16
cannot be waived.
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Sections 2.5-12 of this bill define terms related to the collection of medical
debts and section 2 of this bill makes those terms applicable to sections 2-18.
EXPLANATION – Matter in bolded italics is new; matter between brackets [omitted material] is material to be omitted.
THE PEOPLE OF THE STATE OF NEVADA, REPRESENTED IN
SENATE AND ASSEMBLY, DO ENACT AS FOLLOWS:
Section 1. Chapter 597 of NRS is hereby amended by adding
thereto the provisions set forth as sections 2 to 18, inclusive, of this
act.
Sec. 2. As used in sections 2 to 18, inclusive, of this act,
unless the context otherwise requires, the words and terms defined
in sections 2.5 to 12, inclusive, of this act have the meanings
ascribed to them in those sections.
Sec. 2.5. “Amounts generally billed to individuals who have
insurance covering such care” means the amounts generally billed
to individuals who have insurance covering such care, as
determined for the purposes of section 501(r) of the Internal
Revenue Code, 26 U.S.C. § 501(r), and the regulations adopted
pursuant thereto, including, without lim itation, 26 C.F.R. §
1.501(r)-5.
Sec. 3. “Collection agency” includes:
1. A collection agency, as defined in NRS 649.020.
2. A collection agent, as defined in NRS 649.025.
Sec. 4. “Consumer” means a natural person.
Sec. 5. “Consumer reporting age ncy” has the meaning
ascribed to it in NRS 686A.640.
Sec. 5.5. 1. “Cosmetic surgery” means a surgical
procedure that:
(a) Does not meaningfully promote the proper function of the
body;
(b) Does not prevent or treat illness or disease; and
(c) Is primarily directed at improving or preserving the
appearance of a person.
2. This term does not include reconstructive surgery when
such service is incidental to or follows surgery resulting from the
diagnosis, prevention, treatment, cure or relief from a physical,
dental, behavioral or substance use disorder, mental health
condition, illness, injury or disease.
Sec. 6. “Extraordinary collection action” means:
1. Selling or transferring, with or without compensation, the
medical debt of a consumer to a collection agency;
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2. Any action that requires a legal or judicial process,
including, without limitation, placing a lien , except for a lien on a
third party settlement, or commencing a civil action;
3. Reporting, furnishing or threatening to report or furnish
any information regarding a medical debt to a consumer reporting
agency; or
4. Garnishing or threatening to garnish the wages of a
consumer.
Sec. 7. “Financial assistance policy” means a written
financial assistance policy of a health care entity which the entity
is required to maintain pursuant to section 501(r) of the Internal
Revenue Code, 26 U.S.C. § 501(r) or the provisions of chapter
439B of NRS, which includes:
1. Eligibility criteria for financial assistance, including,
without limitation, when such assistance includes free or
discounted care.
2. The method used to determine the amounts charged to
patients who are eligible for financial assi stance, which must not
exceed the amounts generally billed to individuals who have
insurance covering such care.
3. The method for applying for financial assistance.
4. The billing and collections policy, including, without
limitation, the actions the health care entity may take in the event
of nonpayment.
5. Steps the health care entity will take to proactively inform
patients and members of the community about the financial
assistance policy, including, without limitation:
(a) Posting the policy an d any forms used to apply for
financial assistance under the policy on the Internet website of the
health care entity;
(b) Making paper copies of the policy available upon request
and at locations where the health care entity provides medical
services, medical products or medical devices to patients; and
(c) Offering translations of the financial assistance policy and
related signage in languages commonly spoken in the area served
by the health care entity.
Sec. 8. “Health care entity” means:
1. A medical facility;
2. A provider of emergency medical services; or
3. A provider of health care.
Sec. 9. 1. “Medical debt” means a debt owed by a
consumer to a health care entity or its agent or assignee for the
provision of medical services, medical products or medical devices.
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The term includes, without limitation, medical bills that are not
past due or have been paid.
2. The term does not include debt charged to a credit card, as
defined in NRS 97A.050.
Sec. 10. “Medical facility” has the mean ing ascribed to it in
NRS 449.0151.
Sec. 10.5. “Medical services, medical products or medical
devices” means any service, treatment, drug, medication, product
or device , excluding cosmetic surgery, that is charged to a
consumer by a health care entity.
Sec. 11. “Provider of emergency medical services” has the
meaning ascribed to it in NRS 649.041.
Sec. 12. “Provider of health care” has the meaning ascribed
to it in NRS 629.031.
Secs. 13, 13.3 and 13.7. (Deleted by amendment.)
Sec. 14. A health care entity or collection agency shall not
engage in any of the following actions to collect a medical debt:
1. Causing or threatening the arrest of a consumer,
including, without limitation, an arrest pursuant to NRS 31.470 to
31.730, inclusive;
2. Obtaining or threatening to obtain a lien against any real
property of a consumer which consists, in whole or in part, of the
primary residence of the consumer;
3. Foreclosing or threatening to forecl ose on any real
property of a consumer which consists, in whole or in part, of the
primary residence of the consumer;
4. Garnishing or threatening to garnish any refund of federal
income taxes due to a consumer; or
5. Garnishing, attaching or seizing, or threatening to garnish,
attach or seize, a bank account of a consumer.
Sec. 15. 1. A health care entity or collection agency shall
not engage in any extraordinary collection action until at least 180
days after the first bill for a medical debt has been sent to a
consumer.
2. At least 30 days before taking any extraordinary collection
action to collect a medical debt, a health care entity or collection
agency shall provide to the consumer a notice:
(a) Identifying the extraordinary collection acti on that will be
initiated in order to obtain payment;
(b) Providing a deadline after which such extraordinary
collection action will be initiated, which must be not earlier than
30 days after the date of the notice; and
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(c) If the medical debt was incurr ed for medical services,
medical products or medical devices provided by a medical facility,
stating whether the medical facility offers financial assistance to
eligible consumers and providing a plain -language summary of
any financial assistance policy of the medical facility.
3. A health care entity or collection agency shall not engage
in any extraordinary collection action against a consumer for a
medical debt during any period in which, in any part of the county
in this State in which the consumer resides, there exists:
(a) A state of emergency or declaration of disaster proclaimed
pursuant to NRS 414.070;
(b) A public health emergency or other health event pursuant
to NRS 439.970; or
(c) A state of emergency, declaration of disaster or public
health emergency as declared pursuant to federal law which has
been in effect for less than 6 months.
4. Any statute of limitations applicable to a claim to recover
on a medical debt shall be tolled during any period in which a
health care entity or collection agency is prohibited from engaging
in any extraordinary collection action pursuant to subsection 3.
Sec. 16. 1. If a medical debt was incurred for medical
services, medical products or medical devices provided by a health
care entity, the health care entity or a collection agency shall not
engage in any extraordinary collection action to recover the
medical debt unless such extraordinary collection action is
described in the billing and collections policy of the health care
entity.
2. If a health care entity, or a collection agency acting to
collect a medical debt incurred for medical services, medical
products or medical devices provided by a health care entity,
initiates an extraordinary collection action against a consumer to
collect a me dical debt and the consumer is later found to be
eligible under the financial assistance policy of the health care
entity for financial assistance that eliminates or would have
eliminated the medical debt, the health care entity or collection
agency shall reverse any such extraordinary collection action,
including, without limitation, removing any lien, attachment or
garnishment against the property of the consumer.
3. If, after the application of any financial assistance for
which a consumer is eligible, the consumer has paid, to a health
care entity, a collection agency or both, an amount in excess of the
amount of the medical debt, the health care entity or collection
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agency shall refund any excess amount to the consumer within 60
days.
Sec. 17. The p rotections set forth in sections 13 to 16,
inclusive, of this act are for the benefit of consumers and cannot
be waived.
Sec. 18. (Deleted by amendment.)
Sec. 19. NRS 649.368 is hereby amended to read as follows:
649.368 A collection agency, or its compliance manager,
agents or employees, shall not, for any medical debt:
1. Take any confession of judgment or any power of attorney
running to the collection agency or to any third person to confess
judgment or to appear for the debtor in a judicial proceeding.
2. Commence a civil action to collect the medical debt if the
amount of the medical debt, excluding interest, late fees, collection
costs, attorney’s fees and any other fees or costs, is less than the
maximum jurisdictional amount set forth in subsection 1 of NRS
73.010. Nothing in this subsection shall be construed to prohibit the
commencement of a small claims action in justice court to collect
the medical debt.
3. Charge or collect a fee of more than 5 percent of the amount
of the medical d ebt, excluding interest, late fees, collection costs,
attorney’s fees and any other fees or costs, as a collection fee or as
an attorney’s fee for the collection of the medical debt.
4. Perform an action prohibited by sections 2 to 18, inclusive,
of this act.
Sec. 20. 1. The amendatory provisions of this act apply to:
(a) Any contract between a health care entity and a collection
agency for the purchase , transfer or collection of medical debt
entered into before, on or after January 1, 2026, but do not apply to
any action taken under such a contract before January 1, 2026.
(b) Medical debt incurred before, on or after January 1, 2026,
but do not apply to any action taken to collect a medical debt before
January 1, 2026.
2. As used in this section:
(a) “Collection agency” has the meaning ascribed to it in section
3 of this act.
(b) “Health care entity” has the meaning ascribed to it in section
8 of this act.
(c) “Medical debt” has the meaning ascribed to it in section 9 of
this act.
Sec. 21. This act becomes effective on January 1, 2026.
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