Washington’s push to rein in medical debt interest moved a step closer to becoming law this week, with the State Senate voting to advance Senate Bill 5993 along party lines. The bill, which now heads to the House for consideration, would cap interest on certain medical debt at 1%, marking a significant shift from the state’s current framework and signaling continued momentum among lawmakers to reshape how medical debt is treated in Washington.
The floor debate featured emotional testimony and pointed exchanges over how the policy could reshape both consumer outcomes and the financial health of providers, according to a published report. Supporters cited stories like that of a cancer patient who accrued hundreds of thousands of dollars in medical bills during treatment and later faced lawsuits, wage garnishment threats, and double digit interest on balances he was unable to quickly repay. Lawmakers backing the bill framed these experiences as evidence that medical debt operates differently than other forms of consumer credit and should be treated accordingly.
As amended in committee, SB 5993 would set interest on qualifying medical debt at 1% rather than eliminating interest entirely. The bill was further narrowed on the Senate floor so that the lower interest rate would apply only to new medical debt incurred after December 31, 2026. For collection agencies, law firms, and debt buyers, that delayed effective date creates a longer transition window but also introduces portfolio segmentation challenges as older accounts remain subject to different interest rules than newly originated balances.
Republican lawmakers raised concerns that the policy could disproportionately impact small and rural hospitals that rely on interest revenue to offset delayed or partial repayment. Proposed amendments to create higher interest caps for rural providers or tiered rates based on hospital size were rejected, with supporters arguing that patients should not face different financial treatment based on where they receive care. Opponents countered that the bill risks accelerating closures of already strained rural facilities, which could reduce access to care in underserved areas.
