"Hospital Billing Caps and Financial Distress in California" - Dr Nathan Blascak

We examine the financial consequences of the 2007 California Fair Pricing Law, which places a price ceiling on hospital bills for financially vulnerable individuals. Exploiting cross-sectional variation in exposure to the law, we estimate its impact on financial distress. We find that the law reduces the likelihood of incurring non-medical debt in collections by 14.5 percent and the number of non-medical collections by 31 percent.