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HB 5254

AN ACT RELATING TO INSURANCE -- PHARMACY FREEDOM OF CHOICE -- FAIR COMPETITION AND PRACTICES

2025 Regular Session Introduced by Jennifer Boylan and 6 co-sponsors

HB 5254 would cap medical debt interest by adding a prohibited-conduct standard to the Michigan Consumer Protection Act, treating high medical-interest as an unfair practice.

03/06/2025 Committee recommended measure be held for further study
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Bill Summary · HB 5254

Summary — HB 5254 (House Bill No. 5254)

Short title / purpose
- Modifies Michigan consumer protection law (1976 PA 331, the Michigan Consumer Protection Act or MCPA) with respect to the maximum interest rate allowed on medical debt. The bill amends section 3 (MCL 445.903) of the MCPA. It is tie-barred with HB 5255.

What the bill would do (high-level)

  • HB 5254 updates the MCPA by adding or modifying provisions that govern consumer credit practices relating to medical debt — specifically to limit or modify the maximum interest rate that may be charged on medical debt.
  • The bill is presented as an amendment to MCL 445.903, the statutory section that lists unfair, unconscionable, and deceptive acts or practices in trade and commerce. By amending that section, the bill would treat prohibited conduct around medical debt interest rates as an unfair or deceptive practice under the MCPA.

Note: The version content provided reproduces MCL 445.903 (the list of unfair practices) but is truncated and does not include the explicit new numeric interest-rate cap or the exact amendment language. As drafted text of the specific interest-rate change is not included in the materials provided, this summary describes the bill’s intent and likely effect rather than a verbatim statutory change.

Key provisions (based on title and amendment target)

  • Adds or revises an entry in MCL 445.903 to prohibit charging medical debt interest above a specified maximum (the exact rate and mechanics are not included in the supplied text).
  • By locating the change in the MCPA, the prohibition would be enforceable as an unfair or deceptive trade practice, triggering MCPA remedies and enforcement mechanisms (see “Impact” below).
  • Tie-bar with HB 5255 means HB 5254 and HB 5255 are linked and likely must be enacted together (one cannot become law without the other, per the tie-bar condition).

Who would be affected

  • Consumers (patients) with outstanding medical bills — likely lower allowable interest on outstanding balances if a cap is imposed.
  • Health-care providers, medical creditors, and third‑party medical debt buyers and collection agencies — would need to comply with the new rate limits and consumer‑protection rules.
  • Lenders or creditors that extend credit for medical expenses (including point-of-service payment plans).
  • State enforcement authorities (Attorney General, local prosecutors) and private plaintiffs who bring MCPA actions.

Potential impact

  • Consumer relief: could reduce interest cost and acceleration of medical debt balances, limit collection fees tied to interest, and reduce accrual of interest on unpaid medical bills.
  • Compliance and business impact: Providers and creditors may need to change billing and collection practices; medical debt purchasers may re-price accounts or alter purchasing behavior.
  • Legal exposure: Violations treated as MCPA unfair practices may expose violators to injunctions, civil penalties, and private causes of action available under the MCPA.

Procedural status / timeline

  • Filed: March 14, 2025 (per bill header); electronically reproduced and introduced in current form on November 12, 2025 by Rep. Angela Rigas.
  • November 12, 2025: Read first time; referred to Committee on Health Policy.
  • Other legislative action entries show earlier referrals/readings (possible clerical duplication); current status should be confirmed on the Michigan Legislature website or committee docket for up-to-date movement and committee hearing schedule.

Notes and recommended follow-up

  • The provided text does not include the precise cap or technical amendment language. Review the full bill text (when available) to confirm the exact interest-rate limit, effective date, enforcement language, and cross-references to HB 5255.
  • Monitor committee assignments/hearings in the House Health Policy Committee and related tie-bar bill HB 5255 for coordinated action.

Compiled from official sources — confirm details with the bill’s official record.

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