Colorado Medical Debt Legislation Postponed Following Strong Industry Advocacy

Colorado’s 2026 medical debt bill, HB26-1267 (Limitations on Collection Actions for Medical Debt), was killed in the House Health & Human Services Committee on March 31, 2026, after heavy opposition from hospitals and other industry stakeholders.

What happened procedurally

• HB26-1267 was introduced February 19, 2026 and assigned to House Health & Human Services.

• On March 31, 2026, the committee voted 8–5 to “postpone indefinitely,” which in Colorado effectively kills the bill for the session.

• The motion used a reversal of the previous roll call; with no objection, the bill was officially postponed indefinitely.

Core content of HB26-1267

• Would have added to the list of impermissible collection actions for “medical creditors” when collecting medical debt.

• Required 30‑day notice not just before “extraordinary collection actions,” but also before collecting, transferring, selling, or assigning a medical debt, with verification that the patient had been screened for public coverage and discounted care.

• Substantive protections described by advocates included:

  • Banning wage garnishment for medical debt.

  • Prohibiting seizure of bank accounts below a set threshold (reports reference $5,000).

  • Shortening the limitations period for initiating collection actions to 3 years.

Industry advocacy and opposition

• The Colorado Hospital Association and major health systems actively opposed the bill, arguing that Colorado had already significantly tightened medical debt rules in recent years (interest caps, prior screenings for discounted care, limits on garnishment, and bans on medical-debt credit reporting).

• Hospital representatives emphasized existing obligations to screen for financial assistance, wait at least six months before garnishing wages, give 30 days’ notice, and avoid credit reporting of medical debt, and warned HB26-1267 would further restrict tools to collect even modest, accurate bills.

• Provider and hospital lobbying framed the bill as overreach that could threaten financial stability of hospitals, especially those providing large amounts of uncompensated care.

Advocacy from consumer and patient groups

• Colorado Center on Law and Policy (CCLP), Colorado Consumer Health Initiative, and patient advocates strongly supported HB26-1267, testifying that medical debt is driving wage garnishments, liens, and bankruptcies in the state.

• CCLP and others later publicly challenged what they described as “misinformation” used in the debate and highlighted that the committee’s action leaves Coloradans exposed to aggressive collection practices.

• Data cited in support included roughly 14,000 wage garnishment approvals per year in Colorado courts for unpaid medical bills between 2022 and 2024.

Context within Colorado’s broader framework

• Colorado has already enacted SB23-093 (Fairness in Medical Debt Collection) and HB23-1126 (limits/ban on medical debt credit reporting), adding a 3% annual interest cap on medical debt, detailed itemization and notice requirements, and essentially prohibiting reporting medical debt to consumer reporting agencies.

• Industry opponents leaned on these existing protections to argue HB26-1267 was unnecessary and excessive, while consumer advocates framed the new bill as the next step to address garnishments and asset seizures specifically.