Charging Forward: Implementing New Regulations on Credit Card Payment For Medical Services

Recent legislation has sought to heighten consumer protection for patients with medical debt, with measures ranging from prohibitions on property liens and wage garnishment to limitations on reporting unpaid medical debt to credit agencies. However, many of these measures do not apply where a patient elects to pay for medical services with a credit card. In an effort to extend additional protection to such consumers, the New York legislature enacted General Business Law 519-A, which took effect on October 20, 2024.  

According to guidance issued by the Department of Health on October 18, 2024, the new law prohibits health care providers from requiring preauthorization or having a credit card on file prior to providing emergency or medically necessary services to a patient. Providers may ask patients to voluntarily choose to place a credit card on file but may not require them to do so. Further, providers are required to notify patients of the risk of paying for medical services with a credit card each time such a payment is made. This notice must state that medical bills paid by credit card are no longer considered medical debt. Critically, patients must affirmatively acknowledge that by paying with a credit card, patients are foregoing federal and state protections around medical debt, including prohibitions against wage garnishment and property liens, prohibitions against reporting medical debt to credit bureaus, and limitations on interest rates.

Skilled nursing facilities will need to adapt their payment protocols to ensure that the requisite notices are provided each time a credit card is used to make a payment for services, whether in person, by phone, or electronically. For example, for payments made by phone, providers may want to utilize a recorded line to allow for verbal consent to be memorialized. For electronic payments, an acknowledgment of the required notice should be made before the payment is processed. For other payments, providers may want to prepare a written disclosure to be signed by the patient or responsible party.

Cona Elder Law’s experienced attorneys continue to monitor the most recent developments regarding this legislation as well as other important legal matters concerning the skilled nursing facility, assisted living, and CCRC industry.  Contact us at 631.390.5000 to learn more about how our firm can help your facility preserve your bottom line and ensure your ability to continue to provide quality services to your nursing home residents. 

This article was originally published on LeadingAge New York.