LANSING, MI (WOWO) Michigan lawmakers are considering a bipartisan package of bills designed to limit how hospitals and medical debt collectors can pursue unpaid bills.

The legislation, Senate Bills 701 and 702, would prevent hospitals or debt buyers from taking “extraordinary collection actions,” including wage garnishment, property foreclosure, or arrest over unpaid medical debt, according to Bridge Michigan. The bills also place restrictions on interest and late fees, requiring they not exceed three percent annually, and mandate refunds within 60 days for patients who overpay after financial assistance is applied.

The package would also ensure patients cannot be denied urgent medical care due to unpaid bills, and that no interest or fees accrue until 90 days after the final invoice.

The bills are tied to a companion two-bill package in the House, meaning all four must pass for the legislation to be enacted. Sponsors say the effort is intended to protect patients from financial harm after unexpected medical costs.

Supporters testified in favor of the package during a state Senate Finance, Insurance and Consumer Protection Committee hearing, citing cases like that of Lansing resident Leah Ciolek, who said medical debt damaged her credit and delayed key financial milestones. One organization, the Consumer Data Industry Association, opposed the bills, citing conflicts with federal credit reporting standards. The Michigan Health and Hospital Association has said it is reviewing the proposal.

Whether the legislation will advance in the Republican-led House remains uncertain.