The governor of Nevada last week vetoed a medical debt collection bill, saying it overreached and represented “excessive government intrusion” that would have resulted in “harmful consequences.” The veto was one of 87 different bills vetoed by the governor last week, a new state record.
Driving the news: Nevada Assembly Bill 204, passed during the 2025 legislative session, would have imposed strict new rules on how medical debts could be collected by healthcare providers and collection agencies. It was intended to curb what supporters called “predatory practices” and to protect consumers facing financial harm from unexpected or unaffordable medical bills.
Gov. Joe Lombardo, in his veto message, acknowledged the seriousness of medical debt but said the bill risked unintended outcomes that could reduce access to care, discourage personal responsibility, and potentially increase healthcare costs over time.
“While well-intentioned, AB204 represents excessive government intrusion into contractual relationships,” Lombardo wrote. “It imposes sweeping prohibitions on medical debt collection that could result in harmful consequences for patients and providers alike.”
What the bill would have done: AB204 sought to implement several major changes, including:
- Delaying collection activity: Banning any “extraordinary collection action” for 180 days after the first bill is sent.
- Limiting aggressive tactics: Prohibiting actions such as garnishing wages, placing liens on primary residences, or reporting debts to credit bureaus.
- Suspending collections during emergencies: Restricting collection activity during declared states of emergency, public health emergencies, or other disaster declarations.
- Protecting eligibility for assistance: Requiring refunds and reversal of actions if a consumer is later deemed eligible for financial aid.
- Non-waivable rights: Stating that consumers could not waive the protections established by the law.
Extraordinary collection actions were defined to include selling or transferring debt, initiating lawsuits, reporting to credit agencies, and wage garnishment.
Between the lines: The bill also included requirements for clear notice before any extraordinary action could take place and demanded that providers and agencies comply with any financial assistance policy offered by the healthcare entity.
Consumer advocates strongly criticized the governor’s decision.“This veto sends the wrong message to the thousands of Nevada families struggling to pay for basic healthcare,” according to Adam Zarrin, director of government affairs at The Leukemia & Lymphoma Society. “At a time when people are rationing medications, delaying care, and going into debt just to stay healthy, the Governor chose to stand with the status quo instead of with patients.”
It applied to both new and existing debts but would have only affected collection actions taken on or after January 1, 2026.
