Michigan medical debt collection laws give you real leverage if you use them in time. Two state statutes — the Regulation of Collection Practices Act and Article 9 of the Occupational Code — set the rules for how collectors can behave and communicate, and the federal Fair Debt Collection Practices Act adds protections when a third-party agency is involved. On top of that, the No Surprises Act and Section 501(r) of the Internal Revenue Code can reduce or eliminate what you actually owe before collection ever becomes the question.
One boundary matters up front. The FDCPA generally applies only to outside debt collectors, not to a hospital or doctor’s office collecting its own bill. If your account is still with the hospital’s billing department, your protections come mainly from Michigan law. Once the account is handed to a collection agency, both state and federal rules apply.
What a Collector Cannot Do
Michigan’s Regulation of Collection Practices Act bans a long list of tactics. A collector cannot misrepresent the legal status of any action against you, falsely claim you could be arrested for nonpayment, or threaten to seize property when no such proceeding exists.1Michigan Legislature. Michigan Compiled Laws 445.252 – Prohibited Acts Using forms designed to look like court documents or government notices is also illegal. A collector cannot hide the purpose of a call, fail to identify itself accurately, publish your name on a debtor list, or contact your employer about the debt unless you gave written permission or the employer started the inquiry. If you have a lawyer handling the matter, the collector must go through your attorney as long as the attorney responds within 30 days.
Under the FDCPA, third-party collectors also cannot call before 8:00 a.m. or after 9:00 p.m., and you can demand in writing that they stop contacting you entirely. Federal Regulation F requires any collector who reaches you by email or text to include a clear opt-out in every message, and the collector cannot charge a fee or require personal information to process that opt-out.2eCFR. 12 CFR Part 1006 – Debt Collection Practices (Regulation F)
Disputing the Debt in Writing
Within five days of first contacting you, a collection agency must send written notice showing the amount owed, the name of the creditor, and a statement of your right to dispute. You have 30 days from receiving that notice to dispute in writing. Once you do, the collector must stop all collection activity until it sends verification, which must include the number and amount of prior payments and the name and address of the original creditor if it differs from the current holder.3Michigan Legislature. Michigan Compiled Laws 339.918 – Occupational Code Collection Practices
This is the single most useful right you have. Medical bills routinely contain coding errors, unapplied insurance payments, and charges for services you never received. If you miss the 30-day window, the debt is presumed valid. If you dispute in time, the burden shifts to the collector to document exactly what you owe.
Dispute in writing. A phone call does not trigger the verification requirement. Send your letter by certified mail with return receipt and keep a copy for yourself.
Penalties If a Collector Breaks the Rules
You can sue a collector who violates Michigan’s Regulation of Collection Practices Act. A court will award at least $50 even without proof of specific financial harm. For willful violations, the penalty is at least three times your actual damages or $150, whichever is greater, and the court must award your attorney’s fees and court costs on top of that.4Michigan Legislature. Michigan Compiled Laws Act 70 of 1981 – Regulation of Collection Practices Because the collector pays your legal costs if you win, a lawyer may take a case even when the underlying debt is small.
Michigan also licenses collection agencies through the Department of Licensing and Regulatory Affairs (LARA), which can fine, suspend, or revoke an agency’s license.5Michigan Legislature. Michigan Compiled Laws 339.904 – Collection Agency Licensing
Surprise Bills and Balance Billing
Before you pay a bill, check whether you actually owe it. The federal No Surprises Act, effective in 2022, caps what an out-of-network provider can charge you in most emergencies at your plan’s in-network cost-sharing amount — the copay, coinsurance, and deductible you would normally pay. The same protection covers certain services delivered at an in-network hospital by out-of-network anesthesiologists, pathologists, radiologists, and neonatologists, and those providers cannot ask you to waive it.6U.S. Department of Labor. Avoid Surprise Healthcare Expenses: How the No Surprises Act Can Protect You
Michigan goes further. State rules block balance billing for covered emergency services at both in-network and out-of-network facilities, and for nonemergency services from an out-of-network provider at an in-network facility when you had no ability to choose someone in-network. Michigan also extends protection to any care from an out-of-network provider within 72 hours of treatment in an in-network emergency room.7State of Michigan. Federal No Surprises Act That 72-hour window catches a common pattern: an ER admission followed by specialist visits from providers who happen to be outside your network.
Financial Assistance at Nonprofit Hospitals
Michigan has no state law requiring hospitals to offer charity care, but most Michigan hospitals are nonprofit, and federal tax rules fill the gap. Under Section 501(r), every tax-exempt hospital must maintain a written Financial Assistance Policy covering all emergency and medically necessary care, explaining who qualifies, how to apply, and what collection steps the hospital may take if you do not pay.8eCFR. 26 CFR 1.501(r)-4 – Financial Assistance Policy and Emergency Medical Care Policy
Once the hospital determines you qualify, it cannot charge you more than the “amounts generally billed” to insured patients for the same care. The policy, application form, and a plain-language summary must be available on the hospital’s website, in the emergency room, and in admissions areas. Ask for the application before your account goes to collections. Many people who qualify never apply because they never learned the program existed.
Medical Debt on Your Credit Report
Equifax, Experian, and TransUnion voluntarily agreed in 2022 to stop reporting medical debts under $500, a change that took full effect in spring 2023. Debts below that threshold do not appear on your credit report even if they go to collections.
In early 2025, the Consumer Financial Protection Bureau finalized a rule that would have removed all medical debt from credit reports. A federal court vacated that rule in July 2025, finding it exceeded the CFPB’s authority under the Fair Credit Reporting Act.9Consumer Financial Protection Bureau. CFPB Finalizes Rule to Remove Medical Bills From Credit Reports The $500 voluntary threshold remains the main protection. Medical debts of $500 or more that go to collections can still appear on your report and affect your score.
How Long a Collector Has to Sue You
Michigan’s statute of limitations on medical debt is six years, under the general contract limitations period in MCL 600.5807(9).10Michigan Legislature. Michigan Compiled Laws 600.5807 – Limitations of Actions The clock runs from the date of your last payment or the date the debt first became due, whichever is later. After six years, the debt is time-barred and a collector can no longer sue to force payment.
Time-barred does not mean gone. A collector can still ask you to pay, and the debt can still sit on your credit report subject to the separate seven-year federal reporting limit. If a collector sues on time-barred debt, you can raise the statute of limitations as a complete defense. Be careful about making a partial payment on old debt, because in some circumstances a payment can restart the clock.
If a Collector Sues You
Ignoring a lawsuit is the worst move. A judgment opens the door to wage garnishment, bank levies, and, in some cases, forced sale of property. Interest also runs the whole time.
Wage Garnishment
Federal law caps garnishment for medical and other ordinary debts at 25% of your disposable earnings, meaning your take-home pay after legally required deductions like taxes and Social Security. If your disposable earnings fall below 30 times the federal minimum wage per week, garnishment is further restricted or barred entirely. A Michigan garnishment order stays in place until the judgment is paid off.
Property That Cannot Be Taken
Michigan shields some property from seizure. Household goods, furniture, and appliances are exempt up to $1,000 in value. Tools and equipment needed for your job are exempt up to $1,000. The homestead exemption for a home you own and live in is $3,500 in equity, among the lowest in the country.11Michigan Legislature. Michigan Compiled Laws 600.6023 – Property Exempt From Levy and Sale Clothing, family pictures, and six months of food and fuel are fully exempt regardless of value. Benefits from health or disability insurance policies are generally protected as well.
Interest on the Judgment
Judgment interest runs from the date the complaint was filed, not the date of the judgment. For cases filed after January 1, 1987, the rate is 1% plus the average interest on five-year U.S. Treasury notes over the preceding six-month period, compounded annually, and it applies to the entire judgment including attorney’s fees and court costs.12Michigan Legislature. Michigan Compiled Laws 600.6013 – Interest on Money Judgments Delay costs you money. Respond to the lawsuit.
Bankruptcy as a Last Resort
In bankruptcy, medical debt is treated as general unsecured debt — the same category as credit card balances — which makes it among the easiest debt to discharge. Chapter 7 typically wipes qualifying debts out about four months after filing, if you pass the means test that compares your income to Michigan’s median.13United States Courts. Discharge in Bankruptcy – Bankruptcy Basics Chapter 13 puts you on a three-to-five-year court-supervised repayment plan; medical debts are grouped with other unsecured debts and you pay a percentage based on your disposable income, with any remaining balance discharged at the end.
The costs are real. Chapter 13 stays on your credit report for seven years, Chapter 7 for ten, and both can affect borrowing, renting, and some employment. For someone facing $50,000 or more in medical debt with no realistic way to repay, it can still be the least bad option.
Where to File a Complaint
You can file a consumer complaint with the Michigan Attorney General’s office. Not every complaint is handled by the AG directly; some are referred to other agencies. Filing still creates a record and can trigger an investigation.14State of Michigan: Attorney General. File a Complaint Complaints can be submitted online or by mail, and they become public records under Michigan’s Freedom of Information Act. For conduct by a licensed collection agency, you can also file with LARA, which handles license discipline. Filing with both covers consumer protection and licensing enforcement.