For Immediate Release
Contact: Mike Roth 916-444-7170
Landmark Medical Debt Prevention Law Signed by Gov. Newsom
As federal actions threaten health coverage for millions, health equity and consumer organizations advance bill to protect health access, affordability for Californians
SACRAMENTO, CA – Today, Governor Newsom signed AB 1312, the Patient Debt Prevention Act. This landmark bill will protect patients and families from crushing medical debt after hospital stays, ensuring they are able to access existing hospital financial assistance programs rather than facing debt collectors for bills they shouldn’t owe. Authored by Asm. Pilar Schiavo (D-Chatsworth), the bill was backed by a coalition of health care consumer and health equity advocates including the California Pan-Ethnic Health Network (CPEHN), Health Access California, Leukemia and Lymphoma Society, and Rising Communities.
“No one should be pushed into financial ruin just because they got sick or needed hospital care. The Patient Debt Prevention Act is about making sure patients get the help they’re entitled to, before they’re buried in debt. By ensuring hospitals screen patients for financial assistance up front, we’re protecting families, improving health outcomes, and making our healthcare system more affordable,” said Assemblywoman Pilar Schiavo.
Medical debt is a severe affordability issue for Californians; it’s also a health equity concern. More than one in three Californians reported medical debt in 2023, and the rate is even higher among Black, Latine, and Spanish-speaking Californians and those with low incomes. Patients are forced to skip or delay care making conditions worse; many patients with debt say they struggle to afford basic needs.
Protecting patients from medical debt takes on even greater importance as the state prepares for the impact of HR1, the federal bill that is projected to result in 3.4 million Californians losing their health coverage.
“Preventing medical debt means patients can focus on getting the care they need, not fearing that going to the hospital will result in years of harassment from a debt collector,” said Kiran Savage-Sangwan, Executive Director of CPEHN. “As Californians face devastating cuts to health care access under HR 1, preventing medical debt is one meaningful and tangible way California is standing up for the vulnerable patients and families abandoned by Trump and Congressional Republicans.”
“Medical debt is one of the biggest barriers preventing Californians from getting the care they need and devastating their finances,” said Katie Van Deynze, Senior Policy and Legislative Advocate for Health Access California. “Too many patients, especially those who have low-incomes, and who are Black, or Spanish speaking, are burdened with crushing hospital bills that could have been reduced or eliminated if financial assistance were applied as required by law. Thanks to Assemblymember Pilar Schiavo’s leadership and Governor Newsom’s signature, hospitals will be required to automatically check and apply financial assistance for eligible patients. This simple but powerful change will save time, stress, and money for millions of Californians and prevent families from being pushed into collections for care they couldn’t afford in the first place. Now, while Californians face the fallout of losing their health coverage or facing higher health care costs from the passage of Congress’ H.R. 1, our state is taking a critical step forward to protect patients and make health care more affordable.”
“AB 1312 is a straightforward, proactive safeguard: require hospitals to determine financial assistance eligibility before patients receive their first bill ensuring patients priority is receiving help rather than being sent to collections,” added Dr. Michelle Burton, CEO, Rising Communities. “Medical debt impacts black and Latine communities exponentially in the state of California, and coverage disruptions and federal cuts threaten to widen these systemic inequities. This bill standardizes best practices already used by many California hospitals, reduces red tape, and keeps Californians connected to care without the worry of affording care. Signing AB 1312 continues California’s leadership on health equity and protects families in the communities we serve.”
“Californians who go to the hospital can feel confident they’ll be helped to avoid medical debt,” said Adam Zarrin, director of state government affairs for Blood Cancer United. “Hospital bills have trapped families financially. Thanks to Governor Newsom and Assemblymember Schiavo, that will no longer be the reality when they have a medical emergency or cancer diagnosis.”
The law requires all hospitals to screen patients who are uninsured, enrolled in Medi-Cal with cost-sharing, or enrolled in other means-tested programs, Covered California, or who may be experiencing homelessness. With the Patient Debt Prevention Act, California would also build on past consumer-protection legislation that prevents medical debt from being reported through credit bureaus.
The bill standardizes best practices for financial assistance already underway at more than 100 California hospitals including Adventist, Dignity Health, Kaiser, and Providence Hospitals. Several states including Oregon, Illinois, North Carolina, and Maryland already require hospitals to screen patients for financial assistance eligibility, and some require automatic discounts.
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About Asm. Pilar Schiavo
Assemblywoman Pilar Schiavo represents the 40th Assembly District, representing the Northwest San Fernando Valley and the Santa Clarita Valley.
About the California Pan Ethnic Health Network
The California Pan Ethnic Health Network brings together and mobilizes communities of color to advocate for public policies that advance health equity and improve health outcomes in our communities. Learn more at cpehn.org.
About Health Access California
Health Access California is statewide health care consumer advocacy coalition, working with a broad range of diverse organizations seeking affordable, equitable and quality health care for ALL Californians.
About Blood Cancer United®
Blood Cancer United® (formerly The Leukemia & Lymphoma Society) is the largest global nonprofit focused on blood cancer patient support, research, and advocacy. The organization’s mission is to cure blood cancer and improve the quality of life of all patients and their families. To achieve it, Blood Cancer United brings together a community of people—patients and their families, volunteers, healthcare providers, scientists, staff, partners, fundraisers, and philanthropists—who believe all blood cancer patients deserve longer, fuller lives. For support and to learn more, visit www.BloodCancerUnited.org.
About Rising Communities
Rising Communities (RC), formerly known as Community Health Councils (CHC), is a non-profit, community-based advocacy and policy organization dedicated to advancing social equity and systemic change in underserved communities. Founded in 1992, RC was created in response to growing health and healthcare disparities, with a mission to co-develop transformational social equity models that help communities thrive.