Arizona Prop. 209 will change the rules on collecting medical debts


Arizona voters passed Proposition 209, the Predatory Debt Collection Act, on Tuesday.

The measure was touted as a way to protect Arizonans with medical debt from bankruptcy and poverty. Opponents in the business community say it’s too broad and will have the unintended consequence of making it harder for Arizona workers to get loans.

The Associated Press called the race late Tuesday.

“While the vote count won’t be complete for several days, this feedback demonstrates that Prop 209 will become law in January,” supporters of the Healthcare Rising group said in a statement.

Healthcare Rising supporters who gathered Tuesday night at the Pemberton in downtown Phoenix were optimistic as early results showed a strong lead for “yes” votes.

“It looks promising. It’s something Arizonans have needed for a long time,” band spokesman Morgan Tucker said shortly after 9 p.m. “No one should lose their livelihood to illness. Ever.”

Reacting to the results on Wednesday morning, a spokesperson for opponents of the measure said Proposition 209 had misled voters.

Amber Russo, spokeswoman for Protect Our Arizona, said voters don’t get a true picture of the financial impact of Proposition 209. Since Proposition 209 affects more than just medical debt collection, it predicted it would become harder for Arizona workers to get loans.

“It impacts the collection of all debts,” said Russo, owner of a financial company in Tucson. “I think this is going to take hold in so many different areas of our economy. It’s unfortunate that voters haven’t understood the real impact. The consumer advocates behind this have hidden it under a medical title. “

Proposition 209 lowers maximum interest rates on medical debt and changes several rules on general consumer debt collection.

The statewide ballot measure not only lowers the interest rate cap on medical debt, but also increases the value of protected assets of certain creditors, including state and government tax liens. local.

The medical debt limit in Proposition 209 applies only to medical debt incurred after the measure takes effect. In other words, old medical debts are not protected by the maximum limit of 3%.

Elections: Arizona voters will decide on these ballot measures on November 8

But Arizonans with old debts will be protected in other ways by Proposition 209, including a reduction in wage garnishment and an increase in the value of assets like homes and cars that are protected from creditors. .

Election Day Coverage: Live Voting Updates | Arizona election results

Opponents included several members of the business community, including financial institutions. They say the way the initiative is written is too broad because some of its components will apply to more than just medical debt. The measure increases the value of assets protected from all creditors, not just health care creditors.

Critics also said the measure would weaken the ability of creditors to collect their debts. As a result, financial institutions will be less willing to lend, hurting the Arizona workers the measure is trying to protect, critics say.

Proponents of the measure point out that the initiative does not forgive anyone’s medical or consumer debt. Rather, it gives people leverage to pay what they owe without losing their homes, cars, and all of their savings.

In a year when inflation and the economy are on the minds of voters across the United States, Proposition 209 is getting some national attention as a test case for other states, according to the Fairness Project, a nationwide organization. nonprofit that funds, organizes and advocates for ballot measures. and supported Proposal 209.

“Before now, voters have never incurred medical debt on a statewide ballot measure, but Arizonans have paved the way to tackle predatory lenders through democracy. direct,” Fairness Project executive director Kelly Hall said in a statement Wednesday.

“We look forward to working with citizens of other states who want to pass more ballot measures to protect working families from predatory lending practices.”

Arizonans Fed Up with Failing Healthcare is the ballot measurement committee behind Proposition 209. Healthcare Rising Arizona is the healthcare advocacy group promoting it, with support from the SEIU United Healthcare Workers West union. based in California.

Other supporters include the Arizona Faith Network, the Arizona Student Association, the Southwest Fair Housing Council, and the Arizona Education Association.

Among those who have registered as opponents of Proposition 209 are Victor Riches, president and CEO of the Goldwater Institute; chambers of commerce in both metro Tucson and greater Phoenix; and Paul Hickman, president and CEO of the Arizona Bankers Association.

Liz Gorski, a small business owner from Prescott, was awaiting the results Tuesday at the Pemberton. Gorski has spent years trying to reduce the medical debt she incurred nearly two decades ago from a car accident.

As a single mother, Gorski moved frequently due to problems paying bills, needed loans to go to school, and said she was once sued by a credit card company for $2,500. .

“Wages aren’t that good in Arizona and it’s crazy how much it takes to rent a house or an apartment. It’s super hard,” she said.

Gorski joined Healthcare Rising and lent her support to Proposition 209 in hopes of helping others avoid the struggles she endured, she said.

The most recent data from the Urban Institute, a Washington, D.C. think tank, indicates that just over a quarter of state residents – 27% – had some type of debt in collection, and the median level of overall debt in collection is $1,903. . The number is based on February 2022 credit data.

Proponents of Proposition 209 say medical debt sometimes shows up in general debt categories because people use credit cards to pay their health care bills.

People of color, who are also more likely to lack health insurance, are disproportionately affected by debt, according to the Urban Institute study.

Contact the reporter at or 602-444-8369. Follow her on Twitter @stephanieinnes

Support local journalism. Subscribe to today.


Comments are closed.