Virginia Law

As used in this chapter, unless the context requires a different meaning:

"Consumer reporting agency" has the same meaning as provided in § 59.1-444.1.

"Emergency services" has the same meaning as provided in § 38.2-3438.

"Extraordinary collection action" means any action taken to obtain payment of a medical debt that:

1. Involves selling an individual's medical debt to another party;

2. Involves reporting adverse information about an individual to consumer reporting agencies;

3. Involves deferring, denying, or requiring a payment before providing emergency services or urgent services because of an individual's nonpayment of medical debt; or

4. Requires a legal or judicial process, including placing a lien on an individual's property, foreclosing on an individual's real property, attaching or seizing an individual's bank account or any other personal property, commencing a civil action against an individual, causing an individual's arrest, causing an individual to be subject to a writ of body attachment, or garnishing an individual's wages.

"Financial assistance policy" means a written policy made pursuant to 26 C.F.R. § 1.501(r)-1 or § 32.1-137.010 or other written policy for providing financial assistance to patients adopted by a large health care facility or medical creditor voluntarily or otherwise as required by applicable federal or state law or regulation.

"Health care services" has the same meaning as provided in § 59.1-444.1.

"Large health care facility" includes:

1. Any hospital licensed by the Department of Health pursuant to Chapter 5 (§ 32.1-123 et seq.) of Title 32.1 and any outpatient clinic or facility operating under the license of such a hospital; and

2. Any practice that provides outpatient medical, surgical, behavioral, optical, radiology, laboratory, dental, or other health care services with revenues of at least $20 million annually.

"Medical creditor" means any entity that provides health care services for which a consumer (i) owes medical debt or (ii) if such medical debt has been sold, previously owed medical debt.

"Medical debt" has the same meaning as provided in § 59.1-444.1.

"Medical debt buyer" means a person that is engaged in the business of purchasing medical debt or collecting medical debt on behalf of another entity, whether such person collects the medical debt directly or hires an attorney or other third party to collect such medical debt.

"Medical debt collector" means any person that regularly collects or attempts to collect, directly or indirectly, medical debts originally owed, due, or asserted to be owed or due to another. "Medical debt collector" includes a medical debt buyer.

"Patient" means the individual who received health care services and includes a parent if the patient is a minor or a legal guardian if the patient is an adult under guardianship.

"Urgent services" means health care services the delay of which could seriously jeopardize an individual's life, health, or ability to regain maximum function.

2025, c. 692.

A. No large health care facility or medical debt buyer shall charge a patient any interest or late fees on medical debt until 90 days following the due date applicable to the final invoice, and no such interest or late fees shall exceed three percent of the amount of such medical debt per annum.

B. No medical creditor or medical debt collector shall use any of the following extraordinary collection actions to collect medical debts:

1. Causing an individual's arrest;

2. Causing an individual to be subject to a writ of body attachment;

3. Foreclosing on an individual's real property;

4. Placing a lien on an individual's personal property; or

5. Garnishing the wages of any individual qualifying for financial assistance under the financial assistance policy applicable to the underlying medical debt.

C. No medical creditor shall sell an individual's medical debt to a medical debt buyer except if, prior to such sale, the medical creditor has entered into a legally binding written agreement with the medical debt buyer under which all of the following apply:

1. The medical debt buyer is prohibited from engaging in any extraordinary collection action described in subsection B to obtain payment;

2. The medical debt buyer is prohibited from charging interest on the debt at a rate higher than three percent per annum;

3. The debt is returnable to or recallable by the medical creditor upon a determination by the medical debt buyer that the individual is eligible for financial assistance under the financial assistance policy applicable to the underlying medical debt; and

4. The medical debt buyer is required to adhere to specified procedures that ensure that the individual does not pay, and has no obligation to pay, the medical debt buyer more than such individual is responsible for paying in compliance with this chapter.

D. A medical creditor that sells medical debt to a medical debt buyer under an agreement described in subsection C remains liable for any actions taken by such medical debt buyer in relation to such medical debt, subject to any indemnification provisions as may be agreed to by such parties.

E. No medical creditor or medical debt collector shall take any extraordinary collection action until 120 days following the due date applicable to the final invoice for a health care service. At least 30 days before taking any extraordinary collection action, a medical creditor or medical debt collector shall provide the patient a notice including:

1. If the medical debt resulted from health care services provided by a large health care facility, a statement of whether financial assistance is available for eligible individuals and a plain language summary of any financial assistance policy;

2. A list of any extraordinary collection actions that will be taken to obtain payment; and

3. A deadline after which such extraordinary collection actions will be initiated, which shall be at least 30 days after the date such notice is provided.

F. No large health care facility or medical debt collector collecting medical debt for health care services provided by a large health care facility shall use any extraordinary collection action unless such action is described in the large health care facility's billing and collections policy.

G. If a patient has paid any part of a medical debt in excess of the amount owed after any financial assistance offered by a large health care facility, the large health care facility or medical debt collector, as specified in the agreement required by subsection C, shall refund any excess amount to the patient within 60 days after determination of such excess payment.

2025, c. 692.

Any violation of this chapter shall constitute a prohibited practice under the provisions of § 59.1-200 and shall be subject to any and all of the enforcement provisions of the Virginia Consumer Protection Act (§ 59.1-196 et seq.).

2025, c. 692.