Medical Debt Making a Comeback
It's not just Elon, Republicans in Congress also seek to inflict pain on the people
Just as it seems the scourge of medical debt ruining consumer credit is finally coming to an end, Republicans in Congress are taking action - to protect debt collectors and the credit bureaus.
A rule adopted by the Consumer Financial Protection Bureau (CFPB) would eliminate the reporting of medical debt on consumer credit reports. The rule is slated to take effect later this month.
15 million people in the United States owe some $49 billion in medical debt that is in collections.
However, analysis of medical debt and consumer credit indicates that medical debt is not a reliable indicator of creditworthiness. After all, anyone can get sick and end up owing a hospital or health care provider.
Nevermind that the very idea of medical debt is morally reprehensible. The reality is: it exists. And the Biden Administration took action to help the millions of Americans who paid a price in terms of hits to their credit rating from medical debt.
So, while Elon and the Oligarchs seek to destroy the CFPB, GOP members of Congress are seeking to tear down the gains made over the past four years.
A recent report notes that Sen. Mike Rounds of South Dakota and Rep. Ralph Norman of South Carolina have filed legislation that would nullify the CFPB rule and allow medical debt to continue to appear on credit reports.
The Consumer Financial Protection Bureau rule means that millions of Americans with unpaid medical bills will not face adverse credit decisions as a result, but a bill introduced Wednesday by Senator Mike Rounds (R-SD) and Representative Ralph Norman (R-SC) is urging lawmakers to overturn it.
While 15 million Americans have medical debt on their credit reports, some 100 million Americans have some form of medical debt:
But in any case, a letter signed by 277 organizations is calling on Congress to vote down the bill, highlighting how “more than 100 million people owe at least $220 billion in medical debt and about 15 million people have medical debt on their credit reports.”
Between the dismantling of the CFPB and the move to reverse its consumer protection rules, it is incredibly important that states take up the mantle.
A Tennessee lawmaker has zeroed in on medical debt and is taking action:
With that in mind, Tennessee State Sen. London Lamar filed a pair of bills aimed at offering medical debt relief.
One bill provides direct relief by requiring hospitals to eliminate a certain portion of medical debt. The other says medical debt in collections may not be included on consumer credit reports.
The bills would both require a reduction in total medical debt AND ensure that medical debt incurred by Tennessee residents does not appear on their credit reports.
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