Responses to the NFID’s small-business questionnaire about the proposed regulations to implement S.B. 248 are due on Sept. 10, 2021.
9/3/2021 8:00
On Aug. 31, the Nevada Financial Institutions Division (NFID) posted and sent to licensees a Small Business Impact Questionnaire seeking information about how proposed regulations to implement the state’s new medical debt collection law, S.B. 248, will affect small businesses.
The questionnaire and accompanying documents (proposed regulations and text of S.B. 248) can all be found on the NFID’s proposed regulations webpage.
The NFID has requested that responses to the small-business impact questionnaire be submitted by Friday, Sept. 10.
The request for information—previously proposed to be released on Sept. 7, according to a NFID court filing—came about week before the agency had previously indicated that it would be released.
Ensuring a Robust and Helpful Response
To help ensure the NFID receives a robust and helpful response to the agency’s questions about its proposed S.B. 248 regulations, ACA International encourages all businesses that have an interest in the implementation of S.B. 248 to complete the questionnaire and return it to the NFID no later than Sept. 10.
Under Nevada law, “small business” means a for-profit business that employs fewer than 150 full-time or part-time employees. The questionnaire, however, seeks basic information from all interested organizations (even those that do not qualify as a small business).
Defining “Action to Collect a Medical Debt”
Section 7 of S.B. 248 requires debt collectors that collect medical debt, as defined in the law, to provide medical debtors with a 60-day notice of placement or assignment before the debt collector takes “any action” to collect a medical debt. The proposed regulations would define “action to collect a medical debt” to include, “without limitation,” the following activities:
- Placing telephone calls to a medical debtor.
- Sending communication letters and notices to a medical debtor, other than the 60-day notice required pursuant to S.B. 248.
- Contacting a medical debtor by any electronic means.
- Reporting the medical debt to any credit reporting agency.
- Demanding payment.
- Commencing any civil action.
But, under the proposed regulations, “action to collect a medical debt” would not include:
- Any action initiated by a medical debtor;
- A collection agency, its manager, agents or employees that provide clarification to a medical debtor relating to the content in the written notification required by section 7 of Senate Bill 248, if the contact is initiated by a medical debtor;
- Sending the medical debtor verification of the medical debt if requested by the medical debtor; or
- Sending a receipt for a voluntary payment to the medical debtor.
Required Disclosures and Standard Language for the Section 7 Notice
The proposed regulations would provide additional guidance, including required standard language, for the 60-day notice.
First, the proposed regulations would require that, in addition to the content required under Section 7 of S.B. 248, a collection agency include on the front of the 60-day notice, within the body of the letter, in at least 12-point bold type and in all capital letters, the following disclosure: THIS IS NOT A DEMAND FOR PAYMENT.
Second, the proposed regulations would require debt collectors to print on the front of the notice, in the body of the letter, in at least 12-point bold type the following language:
This notice is to inform you that your medical debt described herein was {assigned to OR otherwise obtained by} us, {enter name of collection agency}. As provided by NRS 649.___, we will not take any action to collect this debt within 60 days from the date of this letter. Any payments made toward the debt during this timeframe are considered voluntary and will not void the 60-day notification period described above. This medical debt will not be reported to any credit reporting agency during the 60-day notification period. Any voluntary payment you may make toward the medical debt during the 60-day period will not extend the applicable statute of limitation, is not an admission of liability and shall not be construed as a waiver of any defense to the collection of the medical debt. This notification is not intended to be a communication under the Fair Debt Collection Practices Act.
Proposed Changes to Letter Review
Interestingly, the NFID has proposed in its draft S.B. 248 regulations to amend Section 649.280 of the Nevada Administrative Code, which currently requires that collection agencies obtain the NFID’s approval of any “machine-derived form letter” prior to using the letter to collect debt.
The proposed regulations would remove the pre-approval requirement. Instead, agencies would be required to provide all form letters to the NFID upon the agency’s request during an examination or investigation. Additionally, it would prohibit debt collectors from using any form letter found to be in violation of state or federal law during an examination or investigation. Finally, it would make clear that letters “returned undeliverable, along with the returned envelope” and “proof of mailing or proof of delivery” shall be considered to be records for the purposes of Nevada Revised Statute 649.335.
Next Steps
After the NFID has gathered all information from the small-business impact survey, ACA expects that the agency will use that information to draft a small-business impact statement by early October, then conduct a workshop on the draft regulations in mid- to late-October.
The information provided to the NFID in response to the small-business impact questionnaire matters because Nevada law requires the agency to “make a concerted effort” to determine whether proposed regulations will likely “impose a direct and significant economic burden upon a small business” or “directly restrict the formation, operation or expansion of a small business (NRS 233B.0608 (1)),” according to the email sent from the NFID to licensees in connection with the small-business impact survey.
“NFID is contacting all known interested parties, including licensed collection agencies, to request information to prepare a small-business impact statement on the proposed draft regulations under Nevada Administrative Code pursuant to the signed legislation by the [g]overnor,” and email from the NFID states.
The regulations likely will not be finalized until at least January 2022, but the proposed draft regulations point to key interpretations that the agency has proposed to promulgate, ACA previously reported.
Stakeholders who complete the small-business impact questionnaire can send responses to the Financial Institutions Division at 3300 W. Sahara, Suite 250, Las Vegas, Nevada 89102, or via email to [email protected], or via fax to (702) 486-4563. Again, responses must be received on or before Sept. 10, 2021.
Meanwhile, ACA and other parties await Judge Richard Boulware II’s ruling on the emergency temporary restraining order motion on S.B. 248, ACA previously reported.
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