Enact the Ohio Medical Debt Fairness Act

As Introduced

136th
General Assembly

Regular
Session
H. B. No. 257

2025-2026

Representatives Grim, Schmidt

Cosponsors: Representatives Brent,
Brennan, Piccolantonio, McNally, Rader, Sigrist, Lett, Brownlee,
Mohamed, Russo, Denson, Cockley, Somani, Johnson, Jarrells, Upchurch,
Hall, D., Baker, Sims, Abdullahi, Synenberg, Miller, J., Robinson,
Richardson, Robb Blasdel, Hall, T.

To
amend sections 1343.01, 1343.03, 1349.01, 2716.02, 2716.03, and
4712.01 and to enact
section

1349.54
of the Revised Code
to
limit the rate of interest on medical debt, to prohibit reporting
medical debt to a consumer reporting agency, and to name this act the
Ohio Medical Debt Fairness Act.

BE
IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF OHIO:

Section
1.
That
sections 1343.01, 1343.03, 1349.01, 2716.02, 2716.03, and 4712.01 be
amended and
section

1349.54
of the Revised Code be enacted to read as follows:

Sec.
1343.01.
(A)
The parties to a bond, bill, promissory note, or other instrument of
writing for the forbearance or payment of money at any future time,
may stipulate therein for the payment of interest upon the amount
thereof at any rate not exceeding eight per cent per annum payable
annually, except as authorized in division (B) of this section

or limited by division (C) of this section
.

(B)

Any

Subject
to division (C) of this section, any
party
may agree to pay a rate of interest in excess of the maximum rate
provided in division (A) of this section when:

(1)
The original amount of the principal indebtedness stipulated in the
bond, bill, promissory note, or other instrument of writing exceeds
one hundred thousand dollars;

(2)
The payment is to a broker or dealer registered under the "Securities
Exchange Act of 1934," 48 Stat. 881, 15 U.S.C. 78A, as amended,
for carrying a debit balance in an account for a customer if such
debit balance is payable on demand and secured by stocks, bonds or
other securities;

(3)
The instrument evidences a loan secured by a mortgage or deed of
trust on real estate where the loan has been approved, insured,
guaranteed, purchased, or for which an offer or commitment to insure,
guarantee, or purchase has been received, in whole or in part, by the
federal government or any agency or instrumentality thereof, the
federal national mortgage association, the federal home loan mortgage
corporation, or the farmers home administration, all of which is
authorized pursuant to the "National Housing Act," 12
.

U.S.C. 1701; the "Serviceman's Readjustment Act," 38 U.S.C.
1801; the "Federal Home Loan Bank Act," 12 U.S.C. 1421; and
the "Rural Housing Act," 42 U.S.C. 1471, amendments
thereto, reenactments thereof, enactments parallel thereto, or in
substitution therefor, or regulations issued thereunder; or by the
state or any agency or instrumentality thereof authorized pursuant to
Chapter 122. of the Revised Code, or rules issued thereunder.

(4)
The instrument evidences a loan secured by a mortgage, deed of trust,
or land installment contract on real estate which does not otherwise
qualify for exemption from the provisions of this section, except
that such rate of interest shall not exceed eight per cent in excess
of the discount rate on ninety-day commercial paper in effect at the
federal reserve bank in the fourth federal reserve district at the
time the mortgage, deed of trust, or land installment contract is
executed.

(5)
The instrument is payable on demand or in one installment and is not
secured by household furnishings or other goods used for personal,
family, or household purposes.

(6)(a)
The loan is a business loan to a business association or partnership,
a person owning and operating a business as a sole proprietor; any
persons owning and operating a business as joint venturers, joint
tenants, or tenants in common; any limited partnership; or any
trustee owning or operating a business or whose beneficiaries own or
operate a business, except that:

(i)
Any loan which is secured by an assignment of an individual obligor's
salary, wages, commissions, or other compensation for services or by

his

the individual obligor's

household furniture or other goods used for

his

the individual obligor's

personal, family, or household purposes shall be deemed not a loan
within the meaning of division (B)(6) of this section;

(ii)
Any loan which otherwise qualifies as a business loan within the
meaning of division (B)(6) of this section shall not be deemed
disqualified because of the inclusion, with other security consisting
of business assets of any such obligor, of real estate occupied by an
individual obligor solely as

his

the individual obligor's

residence.

(b)
As used in division (B)(6)(a) of this section, "business"
means a commercial, agricultural, or industrial enterprise which is
carried on for the purpose of investment or profit. "Business"
does not mean the ownership or maintenance of real estate occupied by
an individual obligor solely as

his

the individual obligor's

residence.

(C)(1)
As used in division (C) of this section, "incur" and
"medical debt" have the same meanings as in section 1349.54
of the Revised Code.

(2)
Notwithstanding any contrary provision of the Revised Code, the rate
of interest drawn upon medical debt incurred on or after the
effective date of this amendment shall not exceed three per cent per
annum.

Sec.
1343.03.
(A)
In cases other than those provided for in sections 1343.01 and
1343.02 of the Revised Code, when money becomes due and payable upon
any bond, bill, note, or other instrument of writing, upon any book
account, upon any settlement between parties, upon all verbal
contracts entered into, and upon all judgments, decrees, and orders
of any judicial tribunal for the payment of money arising out of
tortious conduct or a contract or other transaction, the creditor is
entitled to interest at the rate per annum determined pursuant to
section 5703.47 of the Revised Code, unless a written contract
provides a different rate of interest in relation to the money that
becomes due and payable, in which case the creditor is entitled to
interest at the rate provided in that contract.

(B)
Except as provided in divisions (C)

and
,

(D)
,
and (E)

of this section and subject to section 2325.18 of the Revised Code,
interest on a judgment, decree, or order for the payment of money
rendered in a civil action based on tortious conduct or a contract or
other transaction, including, but not limited to a civil action based
on tortious conduct or a contract or other transaction that has been
settled by agreement of the parties, shall be computed from the date
the judgment, decree, or order is rendered to the date on which the
money is paid and shall be at the rate determined pursuant to section
5703.47 of the Revised Code that is in effect on the date the
judgment, decree, or order is rendered. That rate shall remain in
effect until the judgment, decree, or order is satisfied.

(C)(1)
If, upon motion of any party to a civil action that is based on
tortious conduct, that has not been settled by agreement of the
parties, and in which the court has rendered a judgment, decree, or
order for the payment of money, the court determines at a hearing
held subsequent to the verdict or decision in the action that the
party required to pay the money failed to make a good faith effort to
settle the case and that the party to whom the money is to be paid
did not fail to make a good faith effort to settle the case, interest
on the judgment, decree, or order shall be computed as follows:

(a)
In an action in which the party required to pay the money has
admitted liability in a pleading, from the date the cause of action
accrued to the date on which the order, judgment, or decree was
rendered;

(b)
In an action in which the party required to pay the money engaged in
the conduct resulting in liability with the deliberate purpose of
causing harm to the party to whom the money is to be paid, from the
date the cause of action accrued to the date on which the order,
judgment, or decree was rendered;

(c)
In all other actions, for the longer of the following periods:

(i)
From the date on which the party to whom the money is to be paid gave
the first notice described in division (C)(1)(c)(i) of this section
to the date on which the judgment, order, or decree was rendered. The
period described in division (C)(1)(c)(i) of this section shall apply
only if the party to whom the money is to be paid made a reasonable
attempt to determine if the party required to pay had insurance
coverage for liability for the tortious conduct and gave to the party
required to pay and to any identified insurer, as nearly
simultaneously as practicable, written notice in person or by
certified mail that the cause of action had accrued.

(ii)
From the date on which the party to whom the money is to be paid
filed the pleading on which the judgment, decree, or order was based
to the date on which the judgment, decree, or order was rendered.

(2)
No court shall award interest under division (C)(1) of this section
on future damages, as defined in section 2323.56 of the Revised Code,
that are found by the trier of fact.

(D)
Division (B) of this section does not apply to a judgment, decree, or
order rendered in a civil action based on tortious conduct or a
contract or other transaction, and division (C) of this section does
not apply to a judgment, decree, or order rendered in a civil action
based on tortious conduct, if a different period for computing
interest on it is specified by law, or if it is rendered in an action
against the state in the court of claims, or in an action under
Chapter 4123. of the Revised Code.

(E)(1)
As used in division (E) of this section, "incur" and
"medical debt" have the same meanings as in section 1349.54
of the Revised Code.

(2)
The rate of interest on a judgment, decree, or order for the payment
of a medical debt incurred on or after the effective date of this
amendment shall not exceed three per cent per annum.

Sec.
1349.01.
(A)
As used in this section:

(1)
"Consumer reporting agency" has the same meaning as in the
"Fair Credit Reporting Act," 84 Stat. 1128, 15 U.S.C.A.
1681a.

(2)
"Court" means the division of the court of common pleas
having jurisdiction over actions for divorce, annulment, dissolution
of marriage, legal separation, child support, or spousal support.

(3)
"Health insurance coverage" means hospital, surgical, or
medical expense coverage provided under any health insurance or
health care policy, contract, or plan or any other health benefits
arrangement.

(4)
"Provider" has the same meaning as in section 3902.11 of
the Revised Code.

(B)
If, pursuant to an action for divorce, annulment, dissolution of
marriage, or legal separation, the court determines that a party who
is a resident of this state is responsible for obtaining health
insurance coverage for the party's former spouse or children or if,
pursuant to a child support order issued in accordance with sections
3119.29 to 3119.56 of the Revised Code, the court requires a party
who is a resident of this state to obtain health insurance coverage
for the children who are the subject of the child support order, and
the party fails to obtain such coverage, no provider or collection
agency shall collect or attempt to collect from the former spouse,
children, or person responsible for the children, any reimbursement
of any hospital, surgical, or medical expenses incurred by the
provider for services rendered to the former spouse or children,
which expenses would have been covered but for the failure of the
party to obtain the coverage, if the former spouse, any of the
children, or a person responsible for the children, provides the
following to the provider or collection agency:

(1)
A copy of the court order requiring the party to obtain health
insurance coverage for the former spouse or children.

(2)
Reasonable assistance in locating the party and obtaining information
about the party's health insurance coverage.

(C)
If the requirements of divisions (B)(1) and (2) of this section are
not met, the provider or collection agency may collect the hospital,
surgical, or medical expenses both from the former spouse or person
responsible for the children and from the party who failed to obtain
the coverage. If the requirements of divisions (B)(1) and (2) are
met, the provider or collection agency may collect or attempt to
collect the expenses only from the party.

A
party required to obtain health insurance coverage for a former
spouse or children who fails to obtain the coverage is liable to the
provider for the hospital, surgical, or medical expenses incurred by
the provider as a result of the failure to obtain the coverage. This
section does not prohibit a former spouse or person responsible for
the children from initiating an action to enforce the order requiring
the party to obtain health insurance for the former spouse or
children or to collect any amounts the former spouse or person
responsible for the children pays for hospital, surgical, or medical
expenses for which the party is responsible under the order requiring
the party to obtain health insurance for the former spouse or
children.

(D)(1)
If the requirements of divisions (B)(1) and (2) of this section are
met, both of the following restrictions shall apply:

(a)
No collection agency or provider of hospital, surgical, or medical
services may report to a consumer reporting agency, for inclusion in
the credit file or credit report of the former spouse or person
responsible for the children, any information relative to the
nonpayment of expenses for the services incurred by the provider, if
the nonpayment is the result of the failure of the party responsible
for obtaining health insurance coverage to obtain health insurance
coverage.

(b)
No consumer reporting agency shall include in the credit file or
credit report of the former spouse or person responsible for the
children, any information relative to the nonpayment of any hospital,
surgical, or medical expenses incurred by a provider as a result of
the party's failure to obtain the coverage.

(2)
If the requirements of divisions (B)(1) and (2) of this section are
not met, both of the following provisions shall apply:

(a)
A provider of hospital, surgical, or medical services, or a
collection agency, may report to a consumer reporting agency, for
inclusion in the credit file or credit report of the former spouse or
person responsible for the children, any information relative to the
nonpayment of expenses for the services incurred by the provider, if
the nonpayment is the result of the failure of the party responsible
for obtaining health insurance coverage to obtain such coverage.

(b)
A consumer reporting agency may include in the credit file or credit
report of the former spouse or person responsible for the children,
any information relative to the nonpayment of any hospital, surgical,
or medical expenses incurred by the provider, if the nonpayment is
the result of the failure of the party responsible for obtaining
health insurance coverage to obtain such coverage.

(3)(a)
A provider of hospital, surgical, or medical services, or a
collection agency, may report to a consumer reporting agency, for
inclusion in the credit file or credit report of that party, any
information relative to the nonpayment of expenses for the services
incurred by the provider, if the nonpayment is the result of the
failure of the party responsible for obtaining health insurance
coverage to obtain such coverage.

(b)
A consumer reporting agency may include in the credit file or credit
report of the party responsible for obtaining health insurance
coverage, any information relative to the nonpayment of any hospital,
surgical, or medical expenses incurred by a provider, if the
nonpayment is the result of the failure of that party to obtain
health insurance coverage.

(4)
If any information described in division (D)(2) of this section is
placed in the credit file or credit report of the former spouse or
person responsible for the children, the consumer reporting agency
shall remove the information from the credit file and credit report
if the former spouse or person responsible for the children provides
the agency with the information required in divisions (B)(1) and (2)
of this section. If the agency fails to remove the information from
the credit file or credit report pursuant to the terms of the "Fair
Credit Reporting Act," 84 Stat. 1128, 15 U.S.C. 1681a, within a
reasonable time after receiving the information required by divisions
(B)(1) and (2) of this section, the former spouse may initiate an
action to require the agency to remove the information.

If
any information described in division (D)(3) of this section is
placed in the party's credit file or credit report, the party has the
burden of proving that the party is not responsible for obtaining the
health insurance coverage or, if responsible, that the expenses
incurred are not covered expenses. If the party meets that burden,
the agency shall remove the information from the party's credit file
and credit report immediately. If the agency fails to remove the
information from the credit file or credit report immediately after
the party meets the burden, the party may initiate an action to
require the agency to remove the information.

Sec.
1349.54.
(A)
As used in this section and section 1349.541 of the Revised Code:

(1)
"Collection agency" has the same meaning as in section
1319.12 of the Revised Code.

(2)
"Consumer" means any person obligated or allegedly
obligated to pay a medical debt.

(3)
"Consumer reporting agency" means any person which, for
monetary fees, dues, or on a cooperative nonprofit basis, regularly
engages in whole or in part in the practice of assembling or
evaluating consumer credit information or other information on
consumers for the purpose of furnishing consumer reports to third
parties.

(4)
"Health care provider" has the same meaning as in section
3701.74 of the Revised Code.

(5)
"Incur" means, with respect to medical debt, the date a
health care provider or its designee first sends the consumer,
patient guarantor, or third-party payer a bill for health care
services, products, or devices.

(6)
"Medical debt" means an obligation of a consumer to pay an
amount for the receipt of health care services, products, or devices
including hospital, surgical, and medical expenses, as those terms
are used in section 1349.01 of the Revised Code.

(B)(1)
No health care provider or collection agency shall report to a
consumer reporting agency any information relative to the nonpayment
of medical debt incurred on or after the effective date of this
section for inclusion in a consumer's credit file or credit report.

(2)
If a consumer believes that a health care provider or collection
agency has reported the consumer's medical debt to a consumer
reporting agency in violation of division (B)(1) of this section, the
consumer may commence a civil action against the health care provider
or collection agency.

(3)
If the court holds that a violation occurred, the court shall order
the medical debt or portion of the medical debt reported to a
consumer reporting agency to be void. No health care provider or
collection agency shall bill or otherwise seek to recover the medical
debt from the consumer or any third-party payer, as defined in
section 3901.38 of the Revised Code, following such a holding.

(C)(1)
No consumer reporting agency shall include in a consumer's credit
file or credit report any information relative to the nonpayment of
medical debt incurred on or after the effective date of this section.

(2)
If such information is included in a consumer's credit file or credit
report, the consumer reporting agency shall remove the information.

(3)
If the consumer reporting agency fails to remove the information from
the credit file or credit report pursuant to the terms of the "Fair
Credit Reporting Act," 15 U.S.C. 1681a, within thirty days after
discovering or receiving notice of the information, the consumer has
a civil action to enforce this section.

(4)
The court may require the consumer reporting agency to remove the
information and award the consumer ten dollars in damages for each
day following the initial thirty-day period that the violation
persists.

Sec.
2716.02.
(A)
Any person seeking an order of garnishment of personal earnings,
after obtaining a judgment, shall make the following demand in
writing for the excess of the amount of the judgment over the amount
of personal earnings that may be exempt from execution, garnishment,
attachment, or sale to satisfy a judgment or order, or for so much of
the excess as will satisfy the judgment. The demand shall be made
after the judgment is obtained and at least fifteen days and not more
than forty-five days before the order is sought by delivering it to
the judgment debtor by personal service by the court, by sending it
to the judgment debtor by certified mail, return receipt requested,
or by sending it to the judgment debtor by regular mail evidenced by
a properly completed and stamped certificate of mailing by regular
mail, addressed to the judgment debtor's last known place of
residence.

The
demand shall be in substantially the following form:

"NOTICE
OF COURT PROCEEDING TO COLLECT DEBT

Date
of mailing or date of service by the court ______________

To:
______________________________

(Name
of Judgment Debtor)

__________________________________

(Last
Known Residence Address of Judgment Debtor)

You
owe the undersigned _______________________ (Name of Judgment
Creditor) $__________, including interest and court costs, for which
a judgment was obtained against you or certified in the __________
court on __________, payment of which is hereby demanded.

If
you do not do one of the three things listed below within fifteen
days of the date of the mailing of this notice or of its service by
the court, we will go to court, unless we are otherwise precluded by
law from doing so, and ask that your employer be ordered to withhold
money from your earnings until the judgment is paid in full or, if
applicable, is paid to a certain extent and to pay the withheld money
to the court in satisfaction of your debt. This is called garnishment
of personal earnings.

It
is to your advantage to avoid garnishment of personal earnings
because the placing of the extra burden on your employer possibly
could cause you to lose your job.

YOU
CAN AVOID THE GARNISHMENT BY DOING ONE OF THESE THREE THINGS WITHIN
THE FIFTEEN-DAY PERIOD:

(1)
Pay to us the amount due;

(2)
Complete the attached form entitled "Payment to Avoid
Garnishment" and return it to us with the payment, if any, shown
due on it; or

(3)
Apply to your local municipal or county court or, if you are not a
resident of Ohio, to the municipal or county court in whose
jurisdiction your place of employment is located, for the appointment
of a trustee to receive the part of your earnings that is not exempt
from garnishment, and notify us that you have applied for the
appointment of a trustee. You will be required to list your
creditors, the amounts of their claims, and the amounts due on their
claims, and the amount you then will pay to your trustee each payday
will be divided among them until the debts are paid off. This can be
to your advantage because in the meantime none of those creditors can
garnish your wages.

You
also may contact a budget and debt counseling service described in
division
(D)
(E)

of section 2716.03 of the Revised Code for the purpose of entering
into an agreement for debt scheduling. There may not be enough time
to set up an agreement for debt scheduling in order to avoid a
garnishment of your wages based upon this demand for payment, but
entering into an agreement for debt scheduling might protect you from
future garnishments of your wages. Under an agreement for debt
scheduling, you will have to regularly pay a portion of your income
to the service until the debts subject to the agreement are paid off.
This portion of your income will be paid by the service to your
creditors who are owed debts subject to the agreement. This can be to
your advantage because these creditors cannot garnish your wages
while you make your payments to the service on time.

______________________________

(Name
of Judgment Creditor)

______________________________

(Signature
of Judgment Creditor

-
or
Judgment Creditor's Attorney)

________________________________

________________________________

________________________________

(Address
of Judgment Creditor)

PAYMENT
TO AVOID GARNISHMENT

To:
______________________________

(Name
of Judgment Creditor)

__________________________________

__________________________________

(Address
of Judgment Creditor)

To
avoid the garnishment of personal earnings of which you have given me
notice, I enclose $ _______________ to apply toward my indebtedness
to you. The amount of the payment was computed as follows:

1.

Total
amount of indebtedness demanded:

(1)
$__________

2.

Enter
the amount of your personal earnings,

after
deductions required by law, earned by you

during
the current pay period (that is, the pay

period
in which this demand is received

by
you):

(2)
$___________

3.

(A)
Enter your pay period (weekly, biweekly,

semimonthly,
monthly):

(3)(A)
__________

(B)
Enter the date when your present pay

period
ends:

(3)(B)
__________

4.

Enter
an amount equal to 25% of the amount on

line
(2):

(4)
______________

5.

(A)
The current federal minimum hourly wage is

__________
(to be filled in by Judgment Creditor) (You

should use the above figure to complete this portion of the form.) If
you are paid weekly, enter thirty times the current federal minimum
hourly wage; if paid biweekly, enter sixty times the current federal
minimum hourly wage; if paid semimonthly, enter sixty-five times the
current federal minimum hourly wage; if paid monthly, enter one
hundred thirty times the current federal minimum hourly wage:

(5)(A)
________

-

(B)
Enter the amount by which the amount on line (2) exceeds the amount
on line 5(A):

(5)(B)__________

-

6.

Enter
the smallest of the amounts on line (1), (4), or 5(B). Send this
amount to the judgment creditor along with this form after you have
signed it:

(6)
$___________

-

I
certify that the statements contained above are true to the best of
my knowledge and belief.

___________________________________

-
(Signature
of Judgment Debtor)

___________________________________

___________________________________

___________________________________

-
(Print
Name and Residence Address of

-
Judgment
Debtor)

(To
verify that the amount shown on line (2) is a true statement of your
earnings, you must either have your employer certify below that the
amount shown on line (2) is a true statement of your earnings or you
may submit copies of your pay stubs for the two pay periods
immediately prior to your receiving this notice.)

I
certify that the amount shown on line (2) is a true statement of the
judgment debtor's earnings.

___________________________________

-
(Print
Name of Employer)

___________________________________

-
(Signature
of Employer or Agent)

I
certify that I have attached copies of my pay stubs for the two pay
periods immediately prior to my receiving this notice.

___________________________________

-
(Signature
of Judgment Debtor)"

(B)
If a judgment debtor properly completes a payment to avoid
garnishment and returns it with the required funds to the judgment
creditor or the judgment creditor's attorney, the judgment creditor
or the judgment creditor's attorney who issued the notice of court
proceeding to collect debt may not issue another notice of court
proceeding to collect debt to the judgment debtor until the
expiration date of the judgment debtor's present pay period that is
set forth by the judgment debtor and the judgment debtor's employer
in the answer to (3)(B) in the payment to avoid garnishment.

(C)
If an order of garnishment of personal earnings issued pursuant to
this chapter has not been paid in full when it ceases to remain in
effect because of the operation of division (C)(1) of section
2716.041 of the Revised Code, the garnishee's duties under the order
of garnishment are complete with the filing of the final report and
answer of the garnishee. The judgment creditor must institute new
garnishment proceedings if the judgment creditor wants an additional
garnishment.

Sec.
2716.03.
(A)
Subject to the limitation on the commencement of proceedings
contained in division (B) of section 124.10 of the Revised Code, a
proceeding in garnishment of personal earnings may be commenced after
a judgment has been obtained by a judgment creditor by the filing of
an affidavit in writing made by the judgment creditor or the judgment
creditor's attorney setting forth all of the following:

(1)
The name of the judgment debtor whose personal earnings the judgment
creditor seeks to garnish;

(2)
The name and address of the garnishee who may be an employer of the
judgment debtor and who may have personal earnings of the judgment
debtor;

(3)
That the demand in writing, as required by section 2716.02 of the
Revised Code, has been made;

(4)
That the payment demanded in the notice required by section 2716.02
of the Revised Code has not been made, and a sufficient portion of
the payment demanded has not been made to prevent the garnishment of
personal earnings as described in section 2716.02 of the Revised
Code;

(5)
That the affiant has no knowledge of any application by the judgment
debtor for the appointment of a trustee so as to preclude the
garnishment of the judgment debtor's personal earnings;

(6)
That the affiant has no knowledge that the debt to which the
affidavit pertains is the subject of a debt scheduling agreement of a
nature that precludes the garnishment of the personal earnings of the
judgment debtor under division (B) of this section.

(B)
No proceeding in garnishment of personal earnings shall be brought
against a judgment debtor for the collection of a debt that is the
subject of an agreement for debt scheduling between the judgment
debtor and a budget and debt counseling service, unless any payment
to be made by the judgment debtor, or by a budget and debt counseling
service to the judgment creditor under the agreement for debt
scheduling between the judgment debtor and the budget and debt
counseling service, is due and unpaid for more than forty-five days
after the date on which the payment became due, or unless the
judgment creditor previously was notified by the service that the
debt scheduling agreement between the judgment debtor and the service
was terminated.

(C)
Upon a court's issuance of an order of garnishment of personal
earnings following a judgment creditor's filing of an affidavit under
this section and compliance with section 2716.04 of the Revised Code,
the garnishee and the judgment debtor shall be notified of the
proceeding in garnishment of personal earnings in accordance with
sections 2716.05 and 2716.06 of the Revised Code.

(D)
(D)(1)
As used in division (D) of this section, "incur" and
"medical debt" have the same meanings as in section 1349.54
of the Revised Code.

(2)
No proceeding in garnishment of personal earnings shall be brought
against a judgment debtor for the collection of a medical debt
incurred on or after the effective date of this amendment.

(E)

As used in this chapter:

(1)
A "budget and debt counseling service" or "service"
means a corporation organized under Chapter 1702. of the Revised Code
for the purpose of counseling consumers with respect to their
financial obligations and assisting them in dealing with their
creditors.

(2)
"Debt scheduling" means counseling and assistance provided
to a consumer by a budget and debt counseling service under all of
the following circumstances:

(a)
The counseling and assistance is manifested in an agreement between
the consumer and the service under which the consumer regularly pays
that portion of the consumer's income to the service that has been
determined not to be required for the maintenance of health or the
essentials of life.

(b)
The payments are made to the service until the debts of the consumer
that are the subject of the agreement are fully retired.

(c)
The service has sent written notice, by certified mail, return
receipt requested, or by regular mail evidenced by a properly
completed and stamped certificate of mailing by regular mail, to the
creditors of the consumer that are disclosed by the consumer to the
service. The notice shall contain all of the following:

(i)
A statement of the consumer's intent to participate in debt
scheduling;

(ii)
A summary of the consumer's income, proposed itemized budget,
schedule of creditors, and proposed debt retirement plan;

(iii)
A statement of the particular creditor's duty to respond, in writing,
to the service regarding the consumer's participation in debt
scheduling within fifteen days after receiving the notice.

(d)
The debts of the consumer that are the subject of the agreement for
debt scheduling are determined as follows:

(i)
Any debt owed to a creditor that was notified of the consumer's
intent to participate is a subject of the agreement if the creditor
responds to the service and enters into an agreement with the
service, pursuant to which the creditor agrees not to attempt to
collect the debts of the consumer as long as the consumer regularly
pays to the service the amount previously agreed upon by the service
and the consumer, and no payment to be made by the judgment debtor to
the service or by the service to the creditor is due and unpaid for
more than forty-five days after the date on which the payment became
due, as long as the debt scheduling agreement between the consumer
and the service has not been terminated, and as long as the service
regularly pays to the creditor a mutually acceptable amount that is
either the amount agreed upon by the service and the creditor on the
date they entered into their original agreement or an amount agreed
upon by both the service and the creditor on a date after the date of
the original agreement.

(ii)
Any debt owed to a creditor that was notified of the consumer's
intent to participate is a subject of the agreement if the creditor
does not respond to the service and state the creditor's objection,
in writing, to the consumer's participation in debt scheduling within
fifteen days after receiving notice of the consumer's intention to do
so; however, no debt that is subject to a lien or security interest
of any type, other than a judgment lien or execution lien, shall be a
subject of the agreement unless the creditor specifically assents, in
writing, to the debt being a subject of the agreement. The creditor
shall be considered to have entered into an agreement of the type
described in division
(D)(2)(d)(i)
(E)(2)(d)(i)

of this section, and the amount to be regularly paid by the service
to the creditor shall be an amount determined to be reasonable by the
service or an amount agreed upon by both the service and the creditor
on a date after the expiration of the fifteen-day period.

(iii)
Any debt owed to a creditor that was not notified of the consumer's
intent to participate, or a debt owed to a creditor that was notified
of the consumer's intent to participate and that responded to the
service and stated its objection, in writing, to the consumer's
participation in debt scheduling within fifteen days after receiving
notice of the consumer's intention to do so, is not a subject of the
agreement.

(e)
The service agrees that, if the consumer fails to make a payment
under the agreement within forty-five days of its due date or if the
agreement is terminated, the service will notify each creditor that
is owed a debt that is subject to the agreement of the failure or
termination by regular mail within two business days of the failure
or termination, and the service provides that notice in accordance
with the agreement.

Sec.
4712.01.
As
used in sections 4712.01 to 4712.14 of the Revised Code:

(A)
"Buyer" means an individual who is solicited to purchase or
who purchases the services of a credit services organization for
purposes other than obtaining a business loan as described in
division (B)(6) of section 1343.01 of the Revised Code.

(B)
"Consumer reporting agency" has the same meaning as in the
"Fair Credit Reporting Act," 84 Stat. 1128, 15 U.S.C.A.
1681a, as amended.

(C)(1)
"Credit services organization" means any person that, in
return for the payment of money or other valuable consideration
readily convertible into money for the following services, sells,
provides, or performs, or represents that the person can or will
sell, provide, or perform, one or more of the following services:

(a)
Improving a buyer's credit record, history, or rating;

(b)
Obtaining an extension of credit by others for a buyer;

(c)
Providing advice or assistance to a buyer in connection with division
(C)(1)(a) or (b) of this section;

(d)
Removing adverse credit information that is
accurate
and not
inaccurate
or
obsolete
from the buyer's credit record, history, or rating;

(e)
Altering the buyer's identification to prevent the display of the
buyer's credit record, history, or rating.

(2)
"Credit services organization" does not include any of the
following:

(a)
A person that makes or collects loans, to the extent these activities
are subject to licensure or registration by this state;

(b)
A mortgage broker, as defined in section 1322.01 of the Revised Code,
that holds a valid certificate of registration under Chapter 1322. of
the Revised Code;

(c)
A lender approved by the United States secretary of housing and urban
development for participation in a mortgage insurance program under
the "National Housing Act," 48 Stat. 1246 (1934), 12
U.S.C.A. 1701, as amended;

(d)
A bank, savings bank, or savings and loan association, or a
subsidiary or an affiliate of a bank, savings bank, or savings and
loan association. For purposes of division (C)(2)(d) of this section,
"affiliate" has the same meaning as in division (A) of
section 1101.01 of the Revised Code and "bank," as used in
division (A) of section 1101.01 of the Revised Code, is deemed to
include a savings bank or savings and loan association.

(e)
A credit union organized and qualified under Chapter 1733. of the
Revised Code or the "Federal Credit Union Act," 84 Stat.
994 (1970), 12 U.S.C.A. 1751, as amended;

(f)
A budget and debt counseling service, as defined in division
(D)
(E)

of section 2716.03 of the Revised Code, provided that the service is
a nonprofit organization exempt from taxation under section 501(c)(3)
of the "Internal Revenue Code of 1986," 100 Stat. 2085, 26
U.S.C.A. 501, as amended, and that the service is in compliance with
Chapter 4710. of the Revised Code;

(g)
A consumer reporting agency that is in substantial compliance with
the "Fair Credit Reporting Act," 84 Stat. 1128, 15 U.S.C.A.
1681a, as amended.

(h)
A mortgage banker;

(i)
Any political subdivision, or any governmental or other public
entity, corporation, or agency, in or of the United States or any
state of the United States;

(j)
A college or university, or controlled entity of a college or
university, as defined in section 1713.05 of the Revised Code;

(k)
A motor vehicle dealer licensed pursuant to Chapter 4517. of the
Revised Code acting within the scope and authority of that license or
a motor vehicle auction owner licensed pursuant to Chapters 4517. and
4707. of the Revised Code acting within the scope and authority of
that license;

(l)
An attorney at law admitted to the practice of law in this state who
offers, provides, or performs a legal service that is privileged by
reason of the attorney-client relationship, provided that the service
is not a service described in division (C)(1)(b) or (e) of this
section.

(D)
"Extension of credit" means the right to defer payment of
debt, or to incur debt and defer its payment, offered or granted
primarily for personal, family, or household purposes. "Extension
of credit" does not include a mortgage.

(E)
"Mortgage" means any indebtedness secured by a deed of
trust, security deed, or other lien on real property.

(F)
"Mortgage banker" means any person that makes, services, or
buys and sells mortgage loans and is approved by the United States
department of housing and urban development, the United States
department of veterans affairs, the federal national mortgage
association, or the federal home loan mortgage corporation.

(G)
"Superintendent of financial institutions" includes the
deputy superintendent for consumer finance as provided in section
1181.21 of the Revised Code.

Section
2.
That
existing sections 1343.01, 1343.03, 1349.01, 2716.02, 2716.03, and
4712.01 of the Revised Code are hereby repealed.

Section
3.
This
act shall be known as the Ohio Medical Debt Fairness Act.