Oregon’s medical debt collection laws give patients some of the strongest protections in the country. Collectors are limited on when and how they can contact you, what they can add to a bill, and what they can take from your paycheck. As of January 1, 2026, medical debt cannot appear on your Oregon credit report at all. And if a collector breaks the rules, you can sue for $1,000 or your actual damages, whichever is larger, plus attorney fees.
Medical Debt Is Off Your Credit Report
Oregon Senate Bill 605 took effect January 1, 2026. It prohibits health care providers from reporting medical debt to credit bureaus and bars credit reporting agencies from including medical debt on your credit report.1Oregon Department of Financial Regulation. New Consumer Protection Laws Go Into Effect Jan. 1, 2026 Unlike the national credit bureaus’ voluntary policy, which removed only medical debts under $500 and paid collections, Oregon’s ban applies regardless of the amount or whether you’ve paid.
If a collector or provider reports your medical debt to a credit bureau anyway, that likely counts as an unlawful collection practice under state law, opening the door to the penalties described below.
How Collectors Can Contact You
Oregon’s Unlawful Debt Collection Practices Act, codified at ORS 646.639, controls collector behavior. Calls are only allowed between 8:00 a.m. and 9:00 p.m.2Oregon Department of Justice. Debt Collection Repeated or continuous calls made to harass you or your family are illegal.
Every communication has to identify who is calling. In writing, the first contact must include the collector’s name, the party they’re collecting for, and their business address. On the phone, the collector has to disclose their identity and the purpose of the call within 30 seconds.3Oregon State Legislature. Oregon Revised Statutes 646.639 – Unlawful Collection Practices
Workplace contact is tightly limited. If you tell a collector not to call you at work, or if the collector knows your employer prohibits those calls, they must stop.3Oregon State Legislature. Oregon Revised Statutes 646.639 – Unlawful Collection Practices Even when workplace calls are allowed, they’re capped at once per business week. If you have a lawyer, the collector must go through your lawyer instead of contacting you directly.
Collectors also cannot threaten violence, falsely claim a lawsuit is coming, misrepresent what you owe, or threaten to seize property without telling you a court order would be required first. Under federal Regulation F, email and text are permitted only if you previously used that address or number to discuss the debt or you consented, and every electronic message has to include an opt-out.
Making the Collector Prove the Debt
Federal law requires a collector to send a written validation notice within five days of first contact. It must list the amount, name the creditor, and explain your right to dispute the debt within 30 days.4Office of the Law Revision Counsel. 15 U.S. Code 1692g – Validation of Debts Dispute in writing during that window and collection has to stop until the collector provides verification or a copy of a judgment against you.
Oregon adds more. Hospitals and providers must send you an itemized bill showing the services, treatment dates, and charges before the account can be transferred to collections. When a medical debt is sold or assigned, the new collector has to notify you, identify the original creditor, and confirm the balance. A collector who can’t produce proper records to substantiate the debt can’t pursue payment. You should never be charged a fee for asking for verification; a fee like that is itself a violation.3Oregon State Legislature. Oregon Revised Statutes 646.639 – Unlawful Collection Practices
Interest, Fees, and Other Add-Ons
Oregon caps interest at 9% per year when no written agreement specifies a different rate. If your medical provider’s paperwork says nothing about interest, the collector cannot add it.5Oregon State Legislature. Oregon Revised Statutes Chapter 82 – Interest The same 9% applies to court judgments on medical debt unless the original contract set a higher rate.
The UDCPA flatly prohibits any fee, charge, or interest that neither the original agreement nor a specific law authorizes.3Oregon State Legislature. Oregon Revised Statutes 646.639 – Unlawful Collection Practices If a collector claims you owe attorney fees or collection costs in a lawsuit, they have to point to explicit language in the original contract; courts won’t award them without it. Returned check fees are capped at $35.6Oregon State Legislature. Oregon Code 30.701 – Actions on Dishonored Checks Ask for an itemized breakdown of any collection notice with charges you don’t recognize.
How Long a Collector Can Sue You
Medical debt in Oregon is treated as a contract obligation, and the statute of limitations to file a lawsuit is six years from the date of the last payment or the date the bill became due. Once that window closes, the collector loses the legal right to sue.
Watch two traps. A partial payment or a written acknowledgment of the debt can restart the six-year clock. And the statute only stops lawsuits, not contact; a collector can still call about an expired debt, though they cannot threaten to sue when they know the deadline has passed. If a collector does file suit on a time-barred debt, you have to raise the statute of limitations as a defense in your written response. The court won’t dismiss the case on its own.
What They Can Take From Your Paycheck
A medical debt collector cannot garnish your wages without first filing a lawsuit, winning a judgment, and obtaining a writ of garnishment. Only then can your employer be ordered to withhold.
Federal law limits garnishment to the lesser of 25% of your weekly disposable earnings or the amount by which those earnings exceed 30 times the federal minimum wage of $7.25 per hour ($217.50 per week).7Office of the Law Revision Counsel. 15 U.S. Code 1673 – Restriction on Garnishment Oregon is more protective: the state exempts 75% of your disposable earnings, and for wages payable between July 1, 2026, and July 1, 2027, you cannot be left with less than $400 per week or $1,792 per month. That floor rises annually under Oregon’s Family Financial Protection Act.
Some income cannot be garnished at all: Social Security, Supplemental Security Income, disability payments, workers’ compensation, veterans’ benefits, unemployment, and public assistance like SNAP or TANF.
If You’re Sued
Ignoring a lawsuit is the most expensive mistake you can make. You generally have 30 days to file a written answer; the summons will state your exact deadline. Miss it, and the court enters a default judgment, meaning the collector wins automatically without proving the debt is valid. From there, wage garnishment and bank levies become available.
Filing an answer preserves every defense you have. Common ones: the statute of limitations expired, you already paid, the amount is wrong, or the collector can’t document that it owns the debt. Oregon circuit courts handle medical debt cases above $10,000; smaller amounts can be filed in small claims court. If you can’t afford the filing fee for your response, you can ask the court to waive it. Even if you owe the money, filing an answer often creates room to negotiate a reduced lump sum or a payment plan.
Penalties When a Collector Breaks the Rules
If a collector willfully uses an unlawful collection practice, you can sue for actual damages or $1,000, whichever is greater.8Oregon State Legislature. Oregon Revised Statutes 646.641 – Civil Action for Unlawful Collection Practice; Damages; Attorney Fees; Time for Commencing Action The court can add punitive damages when a collector acted with deliberate disregard for the law, and a prevailing plaintiff can recover reasonable attorney fees and costs.
The Oregon Attorney General can also pursue enforcement independently, with civil penalties up to $25,000 per violation.9Oregon State Legislature. Committee Meeting Document 12446 The Department of Consumer and Business Services can suspend or revoke a collection agency’s registration, and severe cases involving deliberate fraud or coercion can lead to criminal charges.
Document everything. Save voicemails, screenshot texts, and keep every letter. If a collector calls before 8 a.m., threatens arrest, or tacks on unauthorized fees, that evidence supports a claim that can produce damages and, in many cases, wipe out the underlying bill.
Before It Reaches Collections
Oregon requires nonprofit hospitals to provide financial assistance on a sliding scale for household incomes up to 400% of the federal poverty level, with full coverage at or below 200% FPL.10Oregon Health Authority. Hospital Financial Assistance Information for Patients Hospitals must publicize their policies, provide applications, and translate materials for patients with limited English proficiency.11Internal Revenue Service. Financial Assistance Policies (FAPs)
Federal tax rules also stop nonprofit hospitals from starting extraordinary collection actions such as lawsuits, wage garnishment, or credit reporting until at least 120 days after the first billing statement, and require at least 30 days’ written notice before any collection action begins. If you submit a financial assistance application within 240 days of that first bill, the hospital must pause collections while it reviews your eligibility.12Internal Revenue Service. Billing and Collections – Section 501(r)(6) Applying is often the fastest way to reduce or eliminate a bill before any collector gets involved.
Surprise Bills and Bankruptcy
Some bills should never have been sent. The federal No Surprises Act protects patients from balance billing in emergencies even when the treating provider is out of network, and it covers out-of-network providers who treat you at an in-network facility without your knowledge.13U.S. Department of Labor. Avoid Surprise Healthcare Expenses: How the No Surprises Act Can Protect You Cost-sharing for out-of-network emergency care must count toward your in-network deductible and out-of-pocket maximum. Complaints go to the Centers for Medicare and Medicaid Services or your state insurance regulator.
When medical debt is beyond negotiating, bankruptcy can discharge it. Medical bills are unsecured debt and typically wiped out in Chapter 7 in three to six months if you pass the means test, or discharged after a three-to-five-year plan in Chapter 13. Filing before a collector obtains a judgment can prevent garnishment. With medical debt no longer allowed on Oregon credit reports, the usual credit-damage argument against filing has less weight than it once did.