Delaware became one of the strongest states in the country for medical debt consumer protection when Senate Bill 156 took effect on October 27, 2025. The law bans medical debt from appearing on consumer credit reports entirely, removing a barrier that had blocked Delaware residents from qualifying for mortgages, car loans, and jobs because of hospital bills. As of 2026, no person or company may report medical debt to a consumer reporting agency in Delaware, and no credit decision involving a Delaware consumer may factor in medical debt.
Quick Answer: Delaware SB 156, effective October 27, 2025, completely bans medical debt from consumer credit reports. Creditors cannot report new medical debt, and existing medical debt tradelines must be removed. The ban also prohibits using medical debt in credit, employment, or housing decisions. This makes Delaware one of roughly 10 states with a full medical debt credit reporting ban.
What Delaware SB 156 Does
SB 156 amends Delaware's Medical Debt Protection Act (Title 6, Chapter 25J of the Delaware Code) and closes a loophole in the original law that allowed medical debt to appear on credit reports after one year or after a payment plan was established.
Under the 2026 rules, the complete ban works in three directions:
No new reporting. No person, medical provider, debt buyer, or collection agency may report any Delaware medical debt to Equifax, Experian, TransUnion, or any other consumer reporting agency.
Existing tradelines must come down. If medical debt information already sits on your credit report, that information may not be used in any credit, employment, or housing decision. Credit reporting agencies that know a report contains medical debt cannot distribute it.
No downstream use. Even if medical debt somehow ends up in a report, no lender, landlord, or employer may use that information to make decisions about you. The ban covers the full lifecycle of the data, not just the reporting step.
Governor Matt Meyer signed SB 156 on July 29, 2025. The bill passed the Delaware General Assembly with unanimous support. Sponsors were Senator Spiros Mantzavinos and Representative Kim Williams.
Delaware Medical Debt Protection Act: Full Picture
SB 156 builds on broader protections already written into Delaware's Medical Debt Protection Act. Together, the law gives Delaware patients some of the most comprehensive medical billing rights in the country as of 2026.
Interest and Fee Caps
Large healthcare facilities and medical debt collectors may not charge interest, late fees, or prepayment penalties on medical debt in Delaware. That prohibition extends to court judgments resulting from medical debt, even if a contract says otherwise.
Payment Plan Requirements
For any outstanding medical debt of $500 or more, the creditor must offer a payment plan. Monthly payments under that plan cannot exceed 5% of the patient's gross monthly income. The creditor cannot require an initial payment within 30 days of the service date or while you are gathering documentation for a financial assistance application.
| Outstanding Balance | Maximum Monthly Payment | Waiting Period Before First Payment |
|---|
| Under $500 | Payment plan optional | N/A |
| $500 or more | 5% of gross monthly income | 30 days from service date |
| Any amount during billing dispute | Collection paused | Until dispute resolved |
Delaware Medical Debt Protection Act payment plan rules, 2026. Source: Delaware Code Title 6, Chapter 25J
Collection Action Restrictions
Extraordinary collection actions, meaning wage garnishment, bank account attachment, property liens, and lawsuits, cannot begin until 120 days after billing. The creditor must give 30 days of advance notice before pursuing those actions and must tell you about any available financial assistance programs at that point.
A medical creditor also cannot report debt, communicate for collection purposes, or file a lawsuit while a health insurance appeal is pending or was pending within the previous 60 days.
Debt Sale Restrictions
A Delaware medical creditor cannot sell your debt to a debt buyer unless that buyer signs a legally binding agreement prohibiting extraordinary collection actions and interest charges. This means the protections travel with the debt even after it is sold.
Delaware's Medical Debt Relief Program (2026)
Separate from SB 156, Delaware partnered with the nonprofit Undue Medical Debt to use $500,000 in public funds to eliminate up to $50 million in medical debt for qualifying Delaware residents.
Who qualifies:
- Household income below 400% of the federal poverty level (approximately $132,000 for a family of four in 2026), OR
- Medical debt that exceeds 5% of annual household income
Eligible residents receive notification by mail. You do not apply; Undue Medical Debt identifies and eliminates qualifying debt on your behalf. The program is expected to reach more than 17,000 Delaware residents.
How Medical Debt Was Hurting Delaware Residents
Before SB 156, a Delaware resident who had a $3,000 emergency room bill could see that debt appear on their credit report within a year, dropping their credit score by 50 to 100 points and making it harder to rent an apartment, get a car loan, or qualify for a mortgage.
A 2022 Consumer Financial Protection Bureau study found medical debt is a poor predictor of whether someone will repay a loan, yet it was still dragging down millions of credit scores nationally. Delaware's law reflects a broader consensus: illness is not a financial character flaw.
By October 2025, at least nine other states had passed similar laws banning or sharply restricting medical debt credit reporting, including California, New Jersey, and Virginia. The Biden-era federal rule that would have removed medical debt nationally was rescinded by the Trump administration in early 2026, making state-level protections like Delaware's SB 156 the primary safeguard for most Americans.
How to Check If Medical Debt Is Still on Your Delaware Credit Report
Even though SB 156 took effect in October 2025, some old tradelines may not have been removed yet by the time you pull your report in 2026. Here is how to check and dispute.
Step 1: Pull Your Free Credit Reports
Visit AnnualCreditReport.com, the only federally authorized source. You can pull all three bureaus (Equifax, Experian, TransUnion) for free. As of 2026, federal law allows free weekly pulls.
Step 2: Look for Medical Collections
Scan the "Collections" or "Negative Accounts" section. Medical debt often shows up under the name of a collection agency, not the original hospital. Look for account names like Medicredit, Convergent, or similar collection companies.
Step 3: File a Dispute with Each Bureau
If you find medical debt on a Delaware account, file a dispute directly with each bureau:
In your dispute, state that you are a Delaware resident and that SB 156 (effective October 27, 2025) prohibits medical debt from appearing on consumer credit reports under Delaware law. Bureaus typically have 30 days to investigate and remove the item.
Step 4: File a Complaint If the Bureau Refuses
If a bureau refuses to remove the medical debt, you can file a complaint with:
Violations of Delaware's Medical Debt Protection Act are unlawful consumer practices, giving you the right to seek injunctive relief and damages. Pre-dispute arbitration clauses are void under this law.
Step 5: Review Your Hospital Bill for Overcharges
Medical bills frequently contain errors. Studies show as many as 80% of hospital bills contain at least one mistake. The CoveredUSA Bill Analyzer compares each line on your bill to Medicare reimbursement rates, flags charges that exceed those benchmarks, and identifies potential overcharges in about 30 seconds. If you received a large hospital bill, checking it before paying or entering a payment plan can save you significant money and reduce the debt that triggered the credit reporting problem in the first place.
Delaware Hospital Charity Care Reform (2026)
In May 2026, Delaware lawmakers introduced additional legislation to tighten charity care rules for the state's nonprofit hospitals, following an investigative report by Spotlight Delaware.
Senate Bill 13, sponsored by Senator Marie Pinkney, would require hospitals to:
- Post charity care policies prominently in admission areas and on patient bills
- Pause collection activity while financial assistance claims are pending
- Invalidate debt sent to collections while a financial assistance application was in process
The bill has Governor Meyer's support. If passed, it would further strengthen the protections that SB 156 established. Delaware residents with unpaid hospital bills should ask about charity care before making any payment.
Federal vs. Delaware Medical Debt Rules (2026)
Understanding what the federal rules cover (and do not cover) helps Delaware residents know where their strongest protections come from.
| Provision | Federal Rule (2026) | Delaware SB 156 (2026) |
|---|
| Medical debt on credit reports | No federal ban after Biden rule rescinded | Fully banned |
| Interest on medical debt | No federal cap | Zero interest allowed |
| Payment plan requirement | No federal mandate | Required for balances over $500 |
| Cap on monthly payments | None | 5% of gross monthly income |
| Extraordinary collections waiting period | No federal minimum | 120 days after billing |
| Dispute rights | FCRA dispute process | FCRA + Delaware consumer protection claims |
Federal vs. Delaware medical debt protections compared, 2026. Sources: CFPB, Delaware Code Title 6, Chapter 25J
How to Apply for Delaware Financial Assistance
If you have outstanding medical debt, these are your options as of 2026.
Documents you may need:
- Most recent federal tax return or W-2
- Pay stubs (last 2 to 3 months)
- Bank statements (last 2 to 3 months)
- Hospital or provider billing statements
- Proof of Delaware residency (driver's license, utility bill)
- Insurance cards or denial letters if applicable
Step-by-step process:
- Request charity care from your hospital. Delaware nonprofit hospitals must maintain charity care programs. Ask the billing department for a financial assistance application before you pay anything or agree to a payment plan.
- Apply through Delaware ASSIST. The Delaware DHSS benefits portal at assist.dhss.delaware.gov handles Medicaid applications. Delaware Medicaid covers adults up to 138% of the federal poverty level, and enrollment is year-round.
- Check if you qualify for the Undue Medical Debt program. If your income is below 400% FPL or your medical debt exceeds 5% of your income, you may already be in the queue for automatic debt elimination.
- Contact the Delaware Medicare Assistance Bureau (DMAB). For Medicare beneficiaries, DMAB provides free counseling on Medicare Savings Programs and extra help with prescription costs. Call 1-800-336-9500 or visit insurance.delaware.gov/divisions/dmab.
- Request a payment plan if you have a balance over $500. Under Delaware law, the creditor must offer one with monthly payments capped at 5% of your gross income.
- File a dispute with credit bureaus if medical debt appears on your report.
Common reasons applications get denied:
- Income documentation missing or outdated (use the most recent tax year)
- Address does not match Delaware residency records
- Debt has already been sent to a collection agency (contact the agency directly, same protections apply)
- Application filed after a judgment was already entered (rights still apply to post-judgment interest)
Delaware Medicaid Income Limits (2026)
If unpaid medical bills are piling up because you lack health coverage, Delaware Medicaid may eliminate future medical debt entirely. Delaware expanded Medicaid under the ACA, and as of 2026, coverage is available to adults earning up to 138% of the federal poverty level.
| Household Size | Delaware Medicaid Income Limit (138% FPL, 2026) |
|---|
| 1 | $22,025 per year |
| 2 | $29,863 per year |
| 3 | $37,702 per year |
| 4 | $45,540 per year |
| 5 | $53,378 per year |
| 6 | $61,217 per year |
| 7 | $69,055 per year |
| 8 | $76,894 per year |
| Each additional person | +$7,838 per year |
Delaware Medicaid income limits, 2026. Based on 2026 federal poverty level guidelines published by ASPE, HHS.
If your income is above these limits, you may qualify for subsidized ACA marketplace coverage through Healthcare.gov, Delaware's federal marketplace. ACA subsidies are available for incomes up to 400% FPL, and as of 2026, many Delaware residents with income above that threshold still qualify for some premium reduction.
Frequently Asked Questions
Does Delaware SB 156 remove medical debt that is already on my credit report?
Yes. SB 156 prohibits not just future reporting but also the use of any existing medical debt information in consumer credit reports. Credit reporting agencies cannot distribute reports they know contain medical debt information from Delaware residents. If old medical debt is still showing on your report, file a dispute with each bureau citing SB 156 and the Delaware Medical Debt Protection Act.
When did Delaware's medical debt credit reporting ban take effect?
Delaware SB 156 was signed by Governor Matt Meyer on July 29, 2025. The amended law, Senate Substitute 1 for SB 156, took effect on October 27, 2025.
Can a Delaware hospital still sue me over unpaid medical debt?
Yes, but with significant restrictions. The hospital cannot file a lawsuit until 120 days after billing and must give 30 days of advance written notice before filing. The creditor also cannot sue while a health insurance appeal is pending or within 60 days of a pending appeal being resolved. Violations of these rules are unlawful consumer practices under Delaware law.
What if I already have a payment plan with a hospital, and they try to report the debt anyway?
Under Delaware law, no one may report medical debt to a consumer reporting agency regardless of whether a payment plan is in place. The prior version of the law allowed reporting after a payment plan was established; SB 156 removed that exception entirely. If reporting occurs in violation of the law, you have the right to seek damages through the Delaware courts.
Does the Delaware medical debt ban apply to dental debt?
The Delaware Medical Debt Protection Act covers medical debt broadly, which generally includes debt for healthcare services from licensed medical providers. Dental care is typically included. For disputes over specific dental debt, contact the Delaware Department of Justice Consumer Protection Unit at ago.delaware.gov.
What is the Delaware Medicare Assistance Bureau?
The Delaware Medicare Assistance Bureau (DMAB) is a free, state-run counseling service for Medicare beneficiaries. DMAB counselors can help you understand Medicare Savings Programs, which pay Medicare Part A and B premiums for qualifying low-income beneficiaries, and help you apply for Extra Help with prescription drug costs. Call DMAB at 1-800-336-9500.
How do I find out if my hospital bill has errors or overcharges?
Upload your hospital bill to the free CoveredUSA Bill Analyzer. The tool compares each charge on your bill to Medicare reimbursement benchmarks, flags potential overcharges, and identifies whether you may qualify for charity care. Finding and disputing errors before paying reduces your balance and reduces the debt that could lead to collection activity.
My income is too high for Medicaid but I cannot afford my premiums. What options do I have in Delaware?
Delaware uses the federal Healthcare.gov marketplace. ACA subsidies (premium tax credits) are available for incomes between 100% and 400% FPL, and as of 2026 there is no hard income cutoff for a subsidy if your benchmark plan would otherwise cost more than a set percentage of your income. Run a screener to see which coverage you qualify for at coveredusa.org/screener.
Upload your hospital bill to the free CoveredUSA Bill Analyzer to find errors, overcharges, and charity care options in 30 seconds.
