A bill moving through the California legislature aims to reduce medical debt by requiring hospitals to determine whether patients qualify for financial assistance before they leave the hospital.
Assembly Bill 1312, introduced earlier this year, would standardize and streamline the process for screening low-income patients—particularly those without insurance or enrolled in Medi-Cal—for hospital financial aid programs.
Health advocates say too many eligible patients fall through the cracks and end up with medical debt.
“Across 2022 and 2023, we estimate that San Diego adults collectively owed more than $654 million in medical debt,” said Selene Betancourt, a policy analyst with the California Pan-Ethnic Health Network, a health equity advocacy group that is co-sponsoring the bill.
Under current state law, hospitals are required to offer charity care and other discounts to eligible patients. But the burden of applying often falls on patients.
“This can be difficult when you're just trying to recover from an incident in the hospital, or you're trying to help a loved one recover,” Betancourt said. “And so we want to remove these administrative barriers.”
Betancourt said shifting the responsibility to hospitals could prevent people from ending up in collections or facing damaged credit.
Nationwide, only a small share of patients receive the help they qualify for, according to the nonprofit Dollar For, which helps patients apply for financial assistance to pay for hospital bills.
“Only 29% of patients who are eligible for financial assistance at the hospital actually receive it,” said Eli Rushbanks, director of advocacy for the nonprofit. “What seems like it should be a relatively straightforward process, usually a grueling multimonth engagement.”
In San Diego County, roughly 1 in 10 adults had medical debt as of 2022, according to the County’s Office of Equity and Racial Justice. That number was higher among communities of color, where about 11% reported medical debt, compared to less than 8% of white residents.
Rushbanks said Dollar For has been working to reach those affected communities directly, including through Spanish-language outreach on social media.
According to a new West Health-Gallup study, 12% of U.S. adults borrowed money to pay for health care in 2024.
“We're in a health care affordability crisis,” Betancourt said. “It is getting harder and harder to receive the care that you need, even if you do have insurance.”
The California Hospital Association opposes the bill. They declined to be interviewed for this story. In an email they told KPBS they are working with the bill’s author to address concerns. The bill is expected to be heard in the California State Assembly Health Committee later this month.
