S.Amdt. 2828

1. Adds TITLE __--MEDICAL BANKRUPTCIES wherever appropriate

   Adds a title

   Inserted: TITLE __--MEDICAL BANKRUPTCIES

   Inserted: SECTION __1. SHORT TITLE.

   Inserted: This title may be cited as the "Medical Bankruptcy Fairness Act of 2009".

   Inserted: SEC. __2. DEFINITIONS.

   Inserted: Section 101 of title 11, the United States Code, is amended by inserting after paragraph (39A) the following:

   Inserted: "(39B) The term 'medical debt' means any debt incurred directly or indirectly as a result of the diagnosis, cure, mitigation, treatment, or prevention of injury, deformity, or disease, or for the purpose of affecting any structure or function of the body.

   Inserted: "(39C) The term 'medically distressed debtor' means a debtor who, during any 12-month period during the 3 years before the date of the filing of the petition--

   Inserted: "(A) incurred or paid medical debts for the debtor or a dependent of the debtor, or a nondependent member of the immediate family of the debtor (including any parent, grandparent, sibling, child, grandchild, or spouse of the debtor), that were not paid by any third party payor and were in excess of 25 percent of the debtor's annual adjusted gross income (as such term is defined under section 62 of the Internal Revenue Code of 1986), set forth in the most recent Federal income tax return filed by the debtor, or by the debtor and the debtor's spouse, prior to the commencement of the case;

   Inserted: "(B) was a member of a household in which 1 or more members (including the debtor) lost all or substantially all of the member's domestic support obligation income, taking into consideration any disability insurance payments, for 4 or more weeks, due to a medical problem of a person obligated to pay such domestic support; or

   Inserted: "(C) experienced a downgrade in employment status that correlates to a reduction in wages or work hours or results in unemployment, to care for an ill, injured, or disabled dependent of the debtor, or an ill, injured, or disabled nondependent member of the immediate family of the debtor (including any parent, grandparent, sibling, child, grandchild, or spouse of the debtor), for not less than 30 days.".

   Inserted: SEC. __3. EXEMPTIONS.

   Inserted: (a) Exempt Property.--Section 522 of title 11, the United States Code, is amended by adding at the end the following:

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   Inserted: "(r) For a debtor who is a medically distressed debtor, if the debtor elects to exempt property--

   Inserted: "(1) listed in subsection (b)(2), then in lieu of the exemption provided under subsection (d)(1), the debtor may elect to exempt the debtor's aggregate interest, not to exceed $250,000 in value, in real property or personal property that the debtor or a dependent of the debtor uses as a residence, in a cooperative that owns property that the debtor or a dependent of the debtor uses as a residence, or in a burial plot for the debtor or a dependent of the debtor; or

   Inserted: "(2) listed in subsection (b)(3), then if the exemption provided under applicable law specifically for property of the kind described in paragraph (1) is for less than $250,000 in value, the debtor may elect in lieu of such exemption to exempt the debtor's aggregate interest, not to exceed $250,000 in value, in any such real or personal property, cooperative, or burial plot.".

   Inserted: (b) Conforming Amendments.--Sections 104(b)(1) and 104(b)(2) of title 11, the United States Code, are each amended by inserting "522(r)," after "522(q),".

   Inserted: SEC. __4. DISMISSAL OF A CASE OR CONVERSION TO A CASE UNDER CHAPTER 11 OR 13.

   Inserted: Section 707(b) of title 11, the United States Code, is amended by adding at the end the following:

   Inserted: "(8) No judge, United States trustee (or bankruptcy administrator, if any), trustee, or other party in interest may file a motion under paragraph (2) if the debtor is a medically distressed debtor.".

   Inserted: SEC. __5. CREDIT COUNSELING.

   Inserted: Section 109(h)(4) of title 11 United States Code, is amended by inserting "a medically distressed debtor or" after "with respect to".

   Inserted: SEC. __6. NONDISCHARGEABILITY OF CERTAIN ATTORNEYS FEES.

   Inserted: Section 523(a) of title 11, United States Code, is amended--

   Inserted: (1) in paragraph (18), by striking "or" at the end;

   Inserted: (2) in paragraph (19), by striking the period at the end and inserting "; or"; and

   Inserted: (3) by inserting after paragraph (19) the following:

   Inserted: "(20) in a case arising under chapter 7 of this title, owed to an attorney as reasonable compensation for representing the debtor in connection with the case.".

   Inserted: SEC. __7. EFFECTIVE DATE; APPLICATION OF AMENDMENTS.

   Inserted: (a) Effective Date.--Except as provided in subsection (b), this title and the amendments made by this title shall take effect on the date of enactment of this Act.

   Inserted: (b) Application of Amendments.--The amendments made by this title shall apply only with respect to cases commenced under title 11, United States Code, on or after the date of enactment of this Act.

   Inserted: SEC. __8. ATTESTATION BY DEBTOR.

   Inserted: Any debtor who seeks relief as a medically distressed debtor in accordance with the amendments made by this title shall attest in writing and under penalty of perjury that the medical expenses of the debtor were genuine, and were not specifically incurred to bring the debtor within the coverage of the medical bankruptcy provisions, as provided in this title and the amendments made by this title.

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   Original wording

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As printed