House Democrats Introduce Bill to Ban Medical Debt Garnishment

House Democrats introduced legislation on Monday to ban the garnishment of workers' wages for medical debt collection. The bill proposes amendments to the Fair Labor Standards Act of 1938, which would prohibit any state or court from issuing or enforcing such garnishments.

Currently, federal law allows up to 25% of take-home pay to be garnished for debt. While New York, Pennsylvania, Texas, Delaware, and North Carolina already ban the practice, it remains legal in 45 states. Proponents of the bill highlight that over 100 million Americans currently face $220 billion in medical debt.

House Democrats and the bill's co-authors link the rise in medical debt to the expiration of Affordable Care Act subsidies and Medicaid cuts under the Trump administration. They argue these policy changes led to rising premiums and caused millions of Americans to lose health insurance coverage.