CNBC, September 22, 2023, Biden Administration Takes Steps To Remove Medical Bills From Credit Reports
The Biden administration wants to remove medical debt completely from consumer credit reports, so the Consumer Financial Protection Bureau on Thursday outlined its proposed rules to keep unpaid medical bills from affecting patient’s credit scores.
Medical debt is the most common debt in collection. The CFPB found that 58% of all third-party debt collection on consumer credit reports was for medical bills. The complexity of medical billing also makes it prone to errors. One study from the Medical Billing Advocates of America estimates up to 80% of medical bills have mistakes.
The CFPB outlined proposals to prohibit consumer reporting companies such as Equifax, TransUnion and Experian from including medical debts and collection information on consumer credit reports. As of July 2022, the companies no longer include medical debt in collection under $500 on credit reports. New rules would make that voluntary approach mandatory and extend to all medical debt.
