The proposed "Medical Debt Protection Act" aims to regulate the collection and management of medical debt in Michigan. Key provisions include prohibiting large healthcare facilities and medical debt buyers from charging interest or late fees on medical debt until 90 days after the due date, with a cap of 3 percent per annum on such charges. The act also restricts extraordinary collection actions, such as causing an individual's arrest or garnishing wages, particularly for those qualifying for financial assistance. Medical creditors are required to enter into binding agreements with medical debt buyers that prevent these buyers from engaging in extraordinary collection actions and ensure compliance with the act's provisions.

Additionally, the act mandates that medical creditors provide patients with a notice at least 30 days before initiating any extraordinary collection actions, detailing available financial assistance and the specific actions that will be taken. If a patient overpays their medical debt after receiving financial assistance, the facility or debt collector must refund the excess amount within 60 days. Violations of this act will be treated as prohibited practices under the Michigan Consumer Protection Act, ensuring enforcement of these new regulations.