(a) Each emergency physician shall have a written policy about when and under whose authority patient debt is advanced for collection.

(b) Each emergency physician shall establish a written policy defining standards and practices for the collection of debt, and shall obtain a written agreement from any agency that collects emergency physician receivables that it will adhere to the emergency physician’s standards and scope of practice. This agreement shall require the affiliate, subsidiary, or external collection agency of the physician that collects the debt to comply with the physician’s definition and application of a reasonable payment formula, as defined in subdivision (k) of Section 127450. The policy shall not conflict with other applicable laws and shall not be construed to create a joint venture between the emergency physician and the external entity, or otherwise to allow physician and surgeon governance of an external entity that collects physician and surgeon receivables. In determining the amount of a debt the emergency physician may seek to recover from patients who are eligible under the emergency physician’s charity care policy or discount payment policy, the emergency physician may consider only income and monetary assets as limited by Section 127452.

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(c) For a patient that lacks coverage, or for a patient that provides information that he or she may be a patient with high medical costs, the emergency physician, an assignee of the emergency physician, or other owner of the patient debt, including a collection agency, shall not report adverse information to a consumer credit reporting agency or commence civil action against the patient for nonpayment at any time prior to 150 days after initial billing.

(d) If a patient is attempting to qualify for eligibility under the emergency physician’s discount payment policy and is attempting in good faith to settle an outstanding bill with the physician and surgeon by negotiating an extended payment plan, the emergency physician or his or her assignee, including a collection agency, shall not report adverse information to a consumer credit agency or commence a civil action.

(e) (1) The emergency physician or other assignee shall not, in dealing with patients eligible under the emergency physician’s discount payment policies, use wage garnishments or liens on primary residences as a means of collecting unpaid emergency physician bills.

(2) A collection agency or other assignee shall not, in dealing with any patient under the emergency physician’s discount payment policy, use as a means of collecting unpaid emergency physician bills, any of the following:

(A) A wage garnishment, except by order of the court upon noticed motion, supported by a declaration filed by the movant identifying the basis for its belief that the patient has the ability to make payments on the judgment under the wage garnishment, that the court shall consider in light of the size of the judgment and additional information provided by the patient prior to, or at, the hearing concerning the patient’s ability to pay, including information about probable future medical expenses based on the current condition of the patient and other obligations of the patient.

(B) Notice or conduct a sale of the patient’s primary residence during the life of the patient or his or her spouse, or during the period a child of the patient is a minor, or a child of the patient who has attained the age of majority is unable to take care of himself or herself and resides in the dwelling as his or her primary residence. In the event a person protected by this paragraph owns more than one dwelling, the primary residence shall be the dwelling that is the patient’s current homestead, as defined in Section 704.710 of the Code of Civil Procedure, or was the patient’s homestead at the time of the death of a person other than the patient who is asserting the protections of this paragraph.

(3) This requirement does not preclude the emergency physician, collection agency, or other assignee from pursuing reimbursement and any enforcement remedy or remedies from third-party liability settlements, tortfeasors, or other legally responsible parties.

(f) Extended payment plans offered by an emergency physician to assist patients eligible under the emergency physician’s discount payment policy or any other policy adopted by the emergency physician for assisting low-income patients with no insurance or high medical costs in settling outstanding past due emergency physician bills, shall be interest free. The emergency physician’s extended payment plan may be declared no longer operative after the patient’s failure to make all consecutive payments due during a 90-day period. Before declaring the emergency physician’s extended payment plan no longer operative, the emergency physician, collection agency, or assignee shall make a reasonable attempt to contact the patient by telephone, if the telephone number is known, and to give notice in writing that the extended payment plan may become inoperative, and of the opportunity to renegotiate the extended payment plan. Prior to the emergency physician’s extended payment plan being declared inoperative, the emergency physician, collection agency, or assignee shall attempt to renegotiate the terms of the defaulted extended payment plan, if requested by the patient. If the patient wishes to renegotiate the terms of the defaulted extended payment plan but no agreement can be reached on the amount of the payment, the emergency physician or his or her assignee shall apply the reasonable payment formula in subdivision (k) of Section 127450 to determine a monthly payment amount for a subsequent extended payment plan. If the reasonable payment formula would result in a payment of less than ten dollars ($10) a month, the subsequent extended payment plan shall be ten dollars ($10) per month. The emergency physician, collection agency, or assignee shall not report adverse information to a consumer credit reporting agency or commence a civil action against the patient or responsible party for nonpayment prior to the time the extended payment plan is declared to be no longer operative. If after having defaulted on an extended payment plan the patient has entered into another extended payment plan with payments in the amount of either the reasonable payment formula or ten dollars ($10) per month and the patient fails to make all consecutive payments due during a 90-day period, that extended payment plan is inoperative. For purposes of this section, the notice and telephone call to the patient may be made to the last known telephone number and address of the patient.

(g) For purposes of determining the reasonable payment formula in subdivision (k) of Section 127450, the emergency physician or his or her assignee may rely on the determination of family income and essential living expenses made by the hospital at which emergency care was provided. The emergency physician or his or her assignee, at his or her discretion, may accept self-attestation of family income and essential living expenses by a patient or a patient’s legal representative.

(h) Nothing in this section shall be construed to diminish or eliminate any protections consumers have under existing federal and state debt collection laws, or any other consumer protections available under state or federal law. If the patient fails to make all consecutive payments for 90 days and fails to renegotiate a payment plan, this subdivision does not limit or alter the obligation of the patient to make payments on the obligation owing to the emergency physician pursuant to any contract or applicable statute from the date that the extended payment plan is declared no longer operative, as set forth in subdivision (f).

(Amended by Stats. 2014, Ch. 758, Sec. 7. (SB 1276) Effective January 1, 2015.)