II 

111TH CONGRESS 

1ST SESSION S. 1624 

To amend title 11 of the United States Code, to provide protection for 

medical debt homeowners, to restore bankruptcy protections for individuals experiencing economic distress as caregivers to ill, injured, or disabled family members, and to exempt from means testing debtors whose 

financial problems were caused by serious medical problems, and for 

other purposes. 

IN THE SENATE OF THE UNITED STATES 

AUGUST 6, 2009 

Mr. WHITEHOUSE introduced the following bill; which was read twice and 

referred to the Committee on the Judiciary 

A BILL 

To amend title 11 of the United States Code, to provide 

protection for medical debt homeowners, to restore bankruptcy protections for individuals experiencing economic 

distress as caregivers to ill, injured, or disabled family 

members, and to exempt from means testing debtors 

whose financial problems were caused by serious medical 

problems, and for other purposes. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 


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1 SECTION 1. SHORT TITLE. 

2 This Act may be cited as the ‘‘Medical Bankruptcy 

3 Fairness Act of 2009’’. 

4 SEC. 2. DEFINITIONS. 

5 (a) IN GENERAL.—Section 101 of title 11, the United 

6 States Code, is amended— 

7 (1) by inserting after paragraph (39A) the fol8 lowing: 

9 ‘‘(39B) The term ‘medical debt’ means any 

10 debt incurred directly or indirectly as a result of the 

11 diagnosis, cure, mitigation, treatment, or prevention 

12 of injury, deformity, or disease, or for the purpose 

13 of affecting any structure or function of the body. 

14 ‘‘(39C) The term ‘medically distressed debtor’ 

15 means a debtor who, in any consecutive 12-month 

16 period during the 3 years before the date of the fil17 ing of the petition— 

18 ‘‘(A) incurred or paid medical debts for the 

19 debtor or a dependent of the debtor, or a non20 dependent member of the immediate family of 

21 the debtor (including any parent, grandparent, 

22 sibling, child, grandchild, or spouse of the debt23 or), that were not paid by any third party payor 

24 and were in excess of the lesser of— 

25 ‘‘(i) 10 percent of the debtor’s ad26 justed gross income (as such term is deVerDate Nov 24 2008 22:05 Aug 07, 2009 Jkt 079200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\S1624.IS S1624

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1 fined under section 62 of the Internal Rev2 enue Code of 1986); or 

3 ‘‘(ii) $10,000; 

4 ‘‘(B) was a member of a household in 

5 which 1 or more members (including the debt6 or) lost all or substantially all of the member’s 

7 domestic support obligation income, taking into 

8 consideration any disability insurance pay9 ments, for 4 or more weeks, due to a medical 

10 problem of a person obligated to pay such do11 mestic support; or 

12 ‘‘(C) experienced a downgrade in employ13 ment status that correlates to a reduction in 

14 wages or work hours or results in unemploy15 ment, to care for an ill, injured, or disabled de16 pendent of the debtor, or an ill, injured, or dis17 abled nondependent member of the immediate 

18 family of the debtor (including any parent, 

19 grandparent, sibling, child, grandchild, or 

20 spouse of the debtor), for not less than 30 

21 days.’’. 

22 (b) CONFORMING AMENDMENTS.—Sections 

23 104(b)(1) and 104(b)(2) of title 11, the United States 

24 Code, are each amended by inserting ‘‘101(39C)(A)(ii),’’ 

25 after ‘‘101(19)(A)’’. 


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1 SEC. 3. EXEMPTIONS. 

2 (a) EXEMPT PROPERTY.—Section 522 of title 11, the 

3 United States Code, is amended by adding at the end the 

4 following: 

5 ‘‘(r) For a debtor who is a medically distressed debt6 or, if the debtor elects to exempt property— 

7 ‘‘(1) listed in subsection (b)(2), then in lieu of 

8 the exemption provided under subsection (d)(1), the 

9 debtor may elect to exempt the debtor’s aggregate 

10 interest, not to exceed $250,000 in value, in real 

11 property or personal property that the debtor or a 

12 dependent of the debtor uses as a residence, in a co13 operative that owns property that the debtor or a de14 pendent of the debtor uses as a residence, or in a 

15 burial plot for the debtor or a dependent of the debt16 or; or 

17 ‘‘(2) listed in subsection (b)(3), then if the ex18 emption provided under applicable law specifically 

19 for property of the kind described in paragraph (1) 

20 is for less than $250,000 in value, the debtor may 

21 elect in lieu of such exemption to exempt the debt22 or’s aggregate interest, not to exceed $250,000 in 

23 value, in any such real or personal property, cooper24 ative, or burial plot.’’. 

25 (b) CONFORMING AMENDMENTS.—Sections 

26 104(b)(1) and 104(b)(2) of title 11, the United States 


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1 Code, are each amended by inserting ‘‘522(r),’’ after 

2 ‘‘522(q),’’. 

3 SEC. 4. DISMISSAL OF A CASE OR CONVERSION TO A CASE 

4 UNDER CHAPTER 11 OR 13. 

5 Section 707(b) of title 11, the United States Code, 

6 is amended by adding at the end the following: 

7 ‘‘(8) No judge, United States trustee (or bank8 ruptcy administrator, if any), trustee, or other party 

9 in interest may file a motion under paragraph (2) if 

10 the debtor is a medically distressed debtor.’’. 

11 SEC. 5. CREDIT COUNSELING. 

12 Section 109(h)(4) of title 11 United States Code, is 

13 amended by inserting ‘‘a medically distressed debtor or’’ 

14 after ‘‘with respect to’’. 

15 SEC. 6. NONDISCHARGEABILITY OF CERTAIN ATTORNEYS 

16 FEES. 

17 Section 523(a) of title 11, United States Code, is 

18 amended— 

19 (1) in paragraph (18), by striking ‘‘or’’ at the 

20 end; 

21 (2) in paragraph (19), by striking the period at 

22 the end and inserting ‘‘; or’’; and 

23 (3) by inserting after paragraph (19) the fol24 lowing: 


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1 ‘‘(20) incurred by a debtor relating to attorneys 

2 fees generated as result of the debtor’s filing of a 

3 petition under chapter 7.’’. 

4 SEC. 7. EFFECTIVE DATE; APPLICATION OF AMENDMENTS. 

5 (a) EFFECTIVE DATE.—Except as provided in sub6 section (b), this Act and the amendments made by this 

7 Act shall take effect on the date of the enactment of this 

8 Act. 

9 (b) APPLICATION OF AMENDMENTS.—The amend10 ments made by this Act shall apply only with respect to 

11 cases commenced under title 11 of the United States Code 

12 on or after the date of the enactment of this Act. 

13 SEC. 8. ATTESTATION BY DEBTOR. 

14 Any debtor who seeks relief as a medically distressed 

15 debtor in accordance with the amendments made by this 

16 Act shall attest in writing and under penalty of perjury 

17 that the medical expenses of the debtor were genuine, and 

18 were not specifically incurred to bring the debtor within 

19 the coverage of the medical bankruptcy provisions, as pro20 vided in this Act and the amendments made by this Act. 

Æ 


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