II 

113TH CONGRESS 

2D SESSION S. 2471 

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

protections for medically distressed debtors, and for other purposes. 

IN THE SENATE OF THE UNITED STATES 

JUNE 12, 2014 

Mr. WHITEHOUSE (for himself and Ms. WARREN) 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 

bankruptcy protections for medically distressed debtors, 

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, 

3 SECTION 1. SHORT TITLE. 

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

5 Fairness Act of 2014’’. 

6 SEC. 2. DEFINITIONS. 

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

8 States Code, is amended— 

9 (1) by inserting after paragraph (39A) the fol10 lowing: 


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1 ‘‘(39B) The term ‘medical debt’ means any 

2 debt incurred voluntarily or involuntarily— 

3 ‘‘(A) as a result of the diagnosis, cure, 

4 mitigation, or treatment of injury, deformity, or 

5 disease of an individual; or 

6 ‘‘(B) for services performed by a medical 

7 professional in the prevention of disease or ill8 ness of an individual. 

9 ‘‘(39C) The term ‘medically distressed debtor’ 

10 means— 

11 ‘‘(A) a debtor who, during the 3 years be12 fore the date of the filing of the petition— 

13 ‘‘(i) incurred or paid aggregate med14 ical debts for the debtor, a dependent of 

15 the debtor, or a nondependent parent, 

16 grandparent, sibling, child, grandchild, or 

17 spouse of the debtor that were not paid by 

18 any third-party payor and were greater 

19 than the lesser of— 

20 ‘‘(I) 10 percent of the debtor’s 

21 adjusted gross income (as such term 

22 is defined in section 62 of the Internal 

23 Revenue Code of 1986); or 

24 ‘‘(II) $10,000; 


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1 ‘‘(ii) did not receive domestic support 

2 obligations, or had a spouse or dependent 

3 who did not receive domestic support obli4 gations, of at least $10,000 due to a med5 ical issue of the person obligated to pay 

6 that would cause the obligor to meet the 

7 requirements under clause (i) or (iii), if the 

8 obligor was a debtor in a case under this 

9 title; or 

10 ‘‘(iii) experienced a change in employ11 ment status that resulted in a reduction in 

12 wages, salaries, commissions, or work 

13 hours or resulted in unemployment due 

14 to— 

15 ‘‘(I) an injury, deformity, or dis16 ease of the debtor; or 

17 ‘‘(II) care for an injured, de18 formed, or ill dependent or non19 dependent parent, grandparent, sib20 ling, child, grandchild, or spouse of 

21 the debtor; or 

22 ‘‘(B) a debtor who is the spouse of a debt23 or described in subparagraph (A).’’. 

24 (b) CONFORMING AMENDMENTS.—Section 104 of 

25 title 11, United States Code, is amended— 


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1 (1) in subsection (a), by inserting 

2 ‘‘101(39C)(A),’’ after ‘‘101(19)(A),’’; and 

3 (2) in subsection (b), by inserting 

4 ‘‘101(39C)(A),’’ after ‘‘101(19)(A),’’. 

5 SEC. 3. EXEMPTIONS. 

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

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

8 following: 

9 ‘‘(r)(1) If a medically distressed debtor exempts prop10 erty listed in subsection (b)(2), the debtor may, in lieu 

11 of the exemption provided under subsection (d)(1), elect 

12 to exempt the debtor’s aggregate interest, not to exceed 

13 $250,000 in value, in property described in paragraph (3) 

14 of this subsection. 

15 ‘‘(2) If a medically distressed debtor exempts prop16 erty listed in subsection (b)(3) and the exemption provided 

17 under applicable law specifically for the kind of property 

18 described in paragraph (3) is for less than $250,000 in 

19 value, the debtor may elect to exempt the debtor’s aggre20 gate interest, not to exceed $250,000 in value, in any such 

21 property. 

22 ‘‘(3) The property described in this paragraph is— 

23 ‘‘(A) real property or personal property that the 

24 debtor or a dependent of the debtor uses as a resi25 dence; 


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1 ‘‘(B) a cooperative that owns property that the 

2 debtor or a dependent of the debtor uses as a resi3 dence; or 

4 ‘‘(C) a burial plot for the debtor or a dependent 

5 of the debtor.’’. 

6 (b) CONFORMING AMENDMENTS.—Section 104 of 

7 title 11, United States Code, is amended— 

8 (1) in subsection (a), by inserting ‘‘522(r),’’ 

9 after ‘‘522(q),’’; and 

10 (2) in subsection (b), by inserting ‘‘522(r),’’ 

11 after ‘‘522(q),’’. 

12 SEC. 4. WAIVER OF ADMINISTRATIVE REQUIREMENTS. 

13 (a) CASE UNDER CHAPTER 7.—Section 707(b) of 

14 title 11, United States Code, is amended by adding at the 

15 end the following: 

16 ‘‘(8) Paragraph (2) does not apply in any case 

17 in which the debtor is a medically distressed debt18 or.’’. 

19 (b) CASE UNDER CHAPTER 13.—Section 1325(b)(1) 

20 of title 11, United States Code, is amended— 

21 (1) in subparagraph (A), by striking ‘‘or’’ at 

22 the end; 

23 (2) in subparagraph (B), by striking the period 

24 at the end and inserting ‘‘; or’’; and 

25 (3) by adding at the end the following: 


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1 ‘‘(C) the debtor is a medically distressed 

2 debtor.’’. 

3 SEC. 5. CREDIT COUNSELING. 

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

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

6 after ‘‘apply with respect to’’. 

7 SEC. 6. STUDENT LOAN UNDUE HARDSHIP. 

8 Section 523(a)(8) of title 11, United States Code, is 

9 amended by inserting ‘‘the debtor is a medically distressed 

10 debtor or’’ before ‘‘excepting’’. 

11 SEC. 7. ATTESTATION BY DEBTOR. 

12 Section 521 of title 11, United States Code, is 

13 amended by adding at the end the following: 

14 ‘‘(k) If the debtor seeks relief as a medically dis15 tressed debtor, the debtor shall file a statement of medical 

16 expenses relevant to the determination of whether the 

17 debtor is a medically distressed debtor, which statement 

18 shall declare under penalty of perjury that such medical 

19 expenses were not incurred for the purpose of bringing the 

20 debtor within the meaning of the term medically distressed 

21 debtor.’’. 

22 SEC. 8. EFFECTIVE DATE; APPLICATION OF AMENDMENTS. 

23 (a) EFFECTIVE DATE.—Except as provided in sub24 section (b), this Act and the amendments made by this 

25 Act shall take effect on the date of enactment of this Act. 


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1 (b) APPLICATION OF AMENDMENTS.—The amend2 ments made by this Act shall apply only with respect to 

3 cases commenced under title 11, United States Code, on 

4 or after the date of enactment of this Act. 

Æ 


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