New Laws in 2023 That Can Help You With Medical Debt
Key takeaways:
New laws and mandates in 2023 can help you avoid or reduce medical debt.
Starting January 1, 2023, medical debts less than $500 will no longer appear on credit reports.
Insulin will be capped at $35 a month for Medicare enrollees with Part D coverage, thanks to the Inflation Reduction Act.
New laws and mandates effective in 2023 can help you manage medical debt. These consumer-friendly changes may help you save on prescriptions or plan better for the cost of your care upfront.
Here’s what’s new in 2023 that can help you make the most economical healthcare choices for yourself and your family.
Credit reports will exclude medical debt collections under $500
Starting January 1, 2023, the consumer credit-reporting bureaus — Equifax, Experian, and TransUnion — will no longer add medical debt less than $500 to credit reports. Amounts of $500 or more may still show up and can impact your credit score.
Negotiating medical debt to less than $500 or taking action before your healthcare bill goes to collections can keep negative items off your credit report. Medical debt can appear on your credit report for up to 7 years and may be difficult to remove unless the amount owed falls below $500.
Inflation Reduction Act will cap Medicare insulin prices
Starting January 1, 2023, Medicare enrollees with Part D prescription drug plans will pay no more than $35 a month for insulin and will not have to pay a deductible for insulin.
This is one of the many aspects of the Inflation Reduction Act of 2022 that are intended to reduce prescription medication costs over the next few years. The insulin cap is expected to benefit more than 3 million Medicare enrollees.
Read more like this
Explore these related articles, suggested for readers like you.
This price cap applies whether your Part D plan is included in a Medicare Advantage (MA) plan or purchased separately with original Medicare or an MA plan.
Here are a few more details:
The $35 cap applies starting January 1, 2023 for people with a “patch” pump.
Part D plans have until March 1, 2023 to adjust your out-of-pocket cost for insulin. If you end up paying more than $35 for a month’s supply of insulin, your plan must reimburse you for overpayment within 30 days.
Medicare Part B covers insulin used in traditional insulin pumps. The $35-a-month cap for this insulin will start on July 1, 2023.
Private insurance cost comparison tools will be expanded
You may have heard about hospital price transparency. Since 2021, hospitals have been required to publish standard charges for at least 300 services that can be scheduled.
You can also see costs for certain outpatient services in Medicare’s procedure price lookup.
Despite the available tools, research shows that most consumers have trouble estimating the cost of their healthcare.
People with private insurance now have another resource: Health plan price transparency. Since July 2022, health plans have been required to publish price information on certain covered treatments, services, and medications on their websites. The real-time tools should be able to calculate your out-of-pocket costs.
And beginning January 1, 2023, health plans have been required to make price comparison information available for a list of 500 items and services.
These tools may not provide complete clarity, however. That’s because it’s difficult to estimate a procedure bill that could include surgeon’s fees, anesthesia costs, and many other line items. The data might also be outdated.
But there’s more to come: Starting January 1, 2024, health plans must make price comparison information available for all covered services.
What’s more, you’ll have the information on an explanation of benefits (EOB) before receiving care. This will give consumers even more power to compare prices and estimate out-of-pocket costs.
An EOB is a document you normally receive after a health visit, procedure, or test that breaks down the costs of your care. Typically an EOB tells you:
The price charged by the provider
Your health plan’s contracted or negotiated rates
Your cost-sharing obligations, such as meeting a deductible or your responsibility for a copay or coinsurance
Good faith estimates must now include costs beyond the main provider
If you don’t have insurance or plan to self-pay regardless of insurance status, an improved good faith estimate (GFE) may pick up where hospital price transparency and health plan price comparison tools fall short.
GFEs are part of the No Surprises Act, a federal law designed to end surprise medical bills. It took effect on January 1, 2022. A GFE is a more universal view of your projected costs beyond what you can reliably calculate by adding up costs from hospital price lists. For example, a GFE for elective surgery could include expected anesthesia costs and the surgeon’s fee.
Starting in 2023, the main facility or provider must include estimates for related services expected from any co-provider or co-facility in a GFE.
You can request a GFE — a financial document that estimates your healthcare costs upfront — if you don’t have insurance or plan to forgo your coverage and self-pay. You can also dispute the final bill if it’s at least $400 more than the GFE.
How can you manage medical debt?
Managing medical debt begins by planning your healthcare costs upfront and taking action when you receive a medical bill. Some of the best ways to manage medical debt include:
Financial assistance programs for medical bills
Charity care or indigent care to cover your bills at nonprofit hospitals
Patient assistance programs for medical care and prescriptions
Bankruptcy, as a last resort
Keep in mind that you may need to meet income or other eligibility requirements to qualify for some of these programs.
The bottom line
Changes to laws and mandates in 2023 can help you reduce or avoid medical debt. Starting January 1, 2023, medical debts less than $500 will no longer appear on credit reports. There is also a new $35-a-month cap on insulin for Medicare enrollees with Part D plans.
Health plan price transparency will also be more robust in 2023. Private insurance plans are now required to make price comparison information available for at least 500 items and services. And good faith estimates for people who self-pay must include projected costs from the main facility or provider as well as from co-providers and co-facilities.
Why trust our experts?
References
Appleby, J. (2023). Want a clue on health care costs in advance? New tools take a crack at it. Kaiser Health News.
Center for Medicare & Medicaid Services. (n.d.). The No Surprises Act’s good faith estimates and patient-provider dispute resolution requirements.
CMS.gov. (2022). Hospital price transparency.
CMS.gov. (2023). How to get the most out of transparency in coverage.
CMS.gov. (2023). Transparency in coverage.
CMS.gov. (2023). Understanding costs in advance.
CMS.gov. (2023). Use of pricing information published under the transparency in coverage final rule.
Medicare.gov. (n.d.). Saving money with the prescription drug law.
Reed, T. (2022). Consumers will soon get access to huge amounts of health care price data. Axios.
The White House. (2022). By the numbers: The Inflation Reduction Act.
This article is solely for informational purposes. This article is not professional advice concerning insurance, financial, accounting, tax, or legal matters. All content herein is provided “as is” without any representations or warranties, express or implied. Always consult an appropriate professional when you have specific questions about any insurance, financial, or legal matter.
