CA SB1061

Prohibits consumer credit reporting agencies and investigative consumer reporting agencies from including medical debt information in credit reports, and prohibits creditors from using medical debt as a negative factor in credit decisions.

Makes medical debt void and unenforceable if any person knowingly furnishes medical debt information to a credit reporting agency; requires contracts creating medical debt on or after July 1, 2025 to include specific language about these prohibitions.

Prohibits noncontracting health professionals and ground ambulance providers from reporting adverse information to credit agencies for unpaid in-network cost-sharing amounts and requires minimum waiting periods (150 days for health professionals, 12 months for ambulance providers) before commencing civil action.

Requires hospitals to maintain records of patient debt litigation and debt sales for 5 years, and requires contracts for assignment or sale of medical debt to include record-keeping requirements for assignees and subsequent buyers.

Requires health insurers to notify insureds and providers when payment is sent directly to the insured rather than the provider, and allows reporting of unpaid insurer cost-sharing to credit agencies only if payment was received by insured but not forwarded to provider within 60 days or one year of billing.