Medical Debt Wage Garnishment & Foreclosure Prohibition

Current understanding

Proposed Michigan legislation (HB5255) would create a new act prohibiting creditors from foreclosing on property or garnishing wages to collect medical debt. The bill is tie-barred with HB5254 and, if enacted, would add a categorical consumer protection carve-out for medical debt within Michigan’s collection remedies. Status: passed chamber.

Evidence log

• 2026-03-11 — Consumer credit: credit reports and reporting agencies; collection and reporting of medical debt information; regulate. Creates new act.: cross-connection with medical-debt-credit-reporting: Both are part of a coordinated Michigan medical debt consumer protection package — one restricts credit reporting of medical debt while the other bars wage garnishment and foreclosure to collect it. (novelty: 3)
• 2026-06-23 — Consumer credit: credit reports and reporting agencies; collection and reporting of medical debt information; regulate. Creates new act.: cross-connection with medical-debt-credit-reporting: Both restrict downstream financial consequences of medical debt — one shields wages/homes from collection, the other shields credit reports from medical-debt reporting. (novelty: 3)
• 2026-06-23 — Civil procedure: foreclosure; foreclosure or garnishment of wages for medical debt; prohibit. Creates new act. TIE BAR WITH: HB 5254’25: cross-connection with medical-debt-interest-rate-cap: Both address consumer protections specific to medical debt collection in Michigan. (novelty: 3)

Open questions

Related