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, and capping interest rates at 3% per annum. The act also restricts extraordinary collection actions, such as causing an individual's arrest or garnishing wages, particularly for those who qualify for financial assistance. Medical creditors are required to enter into binding agreements with medical debt buyers that prevent these buyers from engaging in such actions and ensure compliance with the act's provisions.

Additionally, the bill mandates that medical creditors provide patients with clear information regarding financial assistance options and any impending extraordinary collection actions at least 30 days prior to taking such actions. If a patient overpays their medical debt after receiving financial assistance, the healthcare facility or debt collector must refund the excess amount within 60 days. Violations of this act would be considered prohibited practices under the Michigan Consumer Protection Act, allowing for enforcement of these new regulations.