The highly publicized Idaho Patient Act, signed into law on March 16, 2020, was created to protect consumers from unfair medical debt collection practices. Proponents asked for increased transparency into healthcare facility and provider charges for products and services and safeguards against unreasonable attorney fees and costs arising out of medical debt collection practices. The Idaho Patient Act, which will go into effect January 1, 2021, addresses both of these concerns.¹

First, the Idaho Patient Act requires healthcare providers to satisfy specific statutory elements before they are permitted to engage in any “extraordinary collection action” against a patient. For purposes of the statute, an “extraordinary collection action” includes (1) selling, transferring, or assigning the patient’s debt to a third-party prior to 60 days from the patient’s receipt of the final statement; (2) reporting adverse information about the patient to a consumer reporting agency; or (3) commencing any judicial or legal action, including placing a lien, attaching or seizing a bank account or personal property, initiating a civil action, or garnishing wages.

Failure to satisfy the statutory requirements prior to commencing an extraordinary collection action can result in the imposition of civil penalties against the provider as well as an inability to recover costs and fees arising out of the collection efforts. Fine amounts are equivalent to actual damages sustained by the patient, or $1,000, whichever is greater. And, in situations where a court finds the provider willfully or knowingly violated statutory requirements, the court can award the patient with the greater of three times their actual damages or $3,000.

To comply with the Idaho Patient Act, healthcare providers must ensure the following requirements are satisfied:

• Provider must submit charges to patient or insurance within 45 days. Healthcare providers must submit all charges related to the provision of good or services to the patient or the patient’s insurance provider within 45 days of when services were provided or the date of discharge, whichever is later.
• Patient must receive summary of services within 60 days. The healthcare provider must send a consolidated summary of services notice to the patient within 60 days of when services were provided or the date of discharge, whichever is later. This summary must include specific elements including the name and contact information of the facility; date and duration of the visit; general description of goods and services provided; names and contact information of each provider who will bill separately for services; and a conspicuous statement indicating the notice is not a bill. Healthcare facilities may be exempt from this requirement if they provide a final statement from a single billing entity for all goods and services rendered to the patient at that healthcare facility.
• Patient must receive a final statement from the billing entity of the healthcare provider. The healthcare provider must send the patient a final statement which contains the name and contact information of the healthcare facility; a list of the goods and services provided to the patient and date they were provided; a statement that a full itemization is available upon request; the name of third-party payors to which the charges were submitted; a detailed description of any reductions, adjustments, or third-party payor payments; and the final amount that the patient is liable to pay.
• Unpaid account must not incur interest, fees, or ancillary charges for 60 days. These fees can not be charged or begin accruing until at least 60 days after the patient’s receipt of the final statement.
• Provider must not take any collection action for 90 days. The healthcare provider cannot initiate any extraordinary collection action until at least 90 days have passed from the patient’s receipt of the final statement and the final resolution of any internal review, good faith disputes, and appeals of any charges or third-party payor obligations.

Second, the Idaho Patient Act imposes statutory limits on the fees that healthcare providers can recover, including costs, expenses, and attorney’s fees, that are incurred from collection efforts. For example, where a provider prevails in an uncontested judgment, fees are capped at $350, while fees for contested judgement are capped at $750. If a healthcare provider can demonstrate to the court that their actual fees that are grossly disproportionate to the statutory fee amount, the court may grant a supplemental award to cover such costs. Conversely, a patient who prevails against a provider’s collection action can recover all costs, expenses, and fees incurred by the patient in contesting the action.

There is some leniency built into the Idaho Patient Act for healthcare providers that fail to meet either the 45-day requirement for submission of charges or the 60-day requirement for the summary of services. In those situations, if the provider can comply with statutorily conferred extension periods, the provider will be permitted to pursue extraordinary collection action without fear of incurring a civil penalty. However, by not strictly adhering to the timing requirements, the healthcare provider will not be able to recover any fees related to collection efforts.

Ultimately, healthcare facilities and providers will need to evaluate their current billing and collection practices against the requirements of the new law. Compliance will likely require changes to billing management software and additional training to staff.

¹ The Idaho Patient Act will be codified at Idaho Code § 48-301 et seq.