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By: The opinion Published Sep 21, 2023, 20:08 pm EDT
The Biden administration announced a major initiative Thursday to protect Americans from medical debt, outlining its plans to develop federal rules that prevent unpaid medical bills from affecting patients’ credit ratings, according to NPR.
The regulations, if enacted, would potentially help tens of millions of people who have medical debt on their credit reports, removing information that can depress consumers’ scores and make it difficult for many to get a job, rent an apartment or get a home loan. buy a car.
The new rules would also represent one of the most significant federal actions to address medical debt, a problem that affects about 100 million people and forces legions to take on extra work, leave their homes and ration food and other essential items, according to a report. KFF Health News-NPR investigation.
“No one in this country should have to go into debt to get the quality health care they need,” said Vice President Kamala Harris, who announced the new measures along with Rohit Chopra, head of the Consumer Financial Protection Bureau (CFPB). That federal agency will be in charge of developing the new rules.
“These measures will improve the credit scores of millions of Americans so they can better invest in their future,” Harris said.
“Access to health care should be a right and not a privilege,” Harris told reporters on a call ahead of the announcement of the proposed measure.
Such an aggressive move to restrict credit reporting and debt collection by hospitals and other medical providers would almost certainly It will also spark industry opposition in a country where about one in five people say they have medical debt.
At the same time, the Consumer Financial Protection Bureau, which was formed in response to the 2008 financial crisis, is under fire from Republican lawmakers, and its future may be threatened by a case before the Supreme Court, whose conservative majority has been undermining the regulatory powers of the federal government.
But the Biden administration’s move received strong praise from patient and consumer groups, many of whom have been pushing for years for the federal government to strengthen protections against medical debt.
Consumer advocates at the National Consumer Law Center (NCLC), Community Catalyst, Americans for Financial Reform, the National Association of Consumer Advocates, RIP Medical Debt, US PIRG and the Colorado Center for Law and Policy applauded the announcement that hehe Consumer Financial Protection Bureau (CFPB) proposes to prohibit the reporting of all medical debt on credit reports.
“Negative credit reports are one of the biggest problems for patients with medical debt,” Chi Chi Wu, senior attorney at the National Consumer Law Center, said in a statement.
The three largest credit bureaus — Equifax, Experian and TransUnion — said they would stop including some medical debt on credit reports starting last year. Excluded debts included canceled invoices and those less than $500.
But the agencies’ voluntary actions left millions of patients with higher medical bills on their credit reports. And many consumer and patient advocates called for more action.
The National Consumer Law Center, Community Catalyst and about 50 other groups sent letters in March to the CFPB and the IRS urging stronger federal action to curb hospital debt collection.
In addition to removing medical bills from credit reports, proposal would prevent creditors from using medical bills when deciding on loans and would prevent debt collectors from using credit scores to pressure people with health care debt.
The government will listen to feedback from small businesses and then issue a notice on a proposed regulation sometime next year.
With information from KFF Health News
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