The exchange for the debt economy
Source: site
The Washington Senate has passed SB 5993, a bill to sharply limit interest on medical debt, and it is now headed to the House, where the next key step is a House committee hearing set for February 18.
What the Senate-passed bill does
-
Caps interest on new medical debt at a maximum of 1% per year, down from the current 9% ceiling in Washington law.
-
Applies to medical debt incurred after December 31, 2026; earlier proposals to cover existing unpaid medical debt were narrowed in committee so that the cap is prospective.
-
Leaves the underlying principal debt enforceable; sponsors emphasize the intent is to make payments more manageable rather than forgive medical debt.
Status and Feb. 18 House review
-
SB 5993 cleared the Senate floor on or about February 6 with Democratic support and no Republican votes.
-
The bill now moves to the House, where it will be referred to a committee (likely a civil/consumer law or health-related committee) for a public hearing and executive action; that first House hearing is scheduled for February 18.
-
The House can amend the bill (e.g., scope of “medical debt,” timing, rate structure) before any floor vote and final concurrence process.
Current Washington law vs. proposed cap
| Feature | Current law (WA) | SB 5993 as passed Senate |
|---|---|---|
| Max interest on medical debt | Up to 9% per year on medical judgments. | 1% per year cap on new medical debt. |
| Coverage timing | Applies to existing medical judgments. | New medical debt incurred after 12/31/2026. |
| Unpaid existing medical debt | Can accrue interest up to 9%. | Original bill would have eliminated interest; amended to focus on future debt only. |
| Judgment enforcement period | General civil judgment rules apply. | Earlier versions proposed a 6‑year limit for medical judgments; details may be revisited in House. |
Policy arguments surfacing
-
Supporters (including the prime sponsor, Sen. Emily Alvarado) frame the bill as medical-debt relief in an affordability crisis, noting that about one in five Washington households has medical debt and that high interest does not meaningfully improve collection performance.
-
Opponents, including Republican senators and the Washington State Hospital Association, argue that slashing interest could strain hospital finances—especially rural and small hospitals—and shift costs through higher premiums or reduced services.
If you’d like, I can pull the current substitute or engrossed text and walk through specific provisions (definitions of “medical debt,” treatment of prejudgment vs. post‑judgment interest, retroactivity, and enforcement limits) for compliance or operational impact analysis.
Upcoming Events
