BusinessBiden Administration to Remove Medical Bills from Credit Scores

Biden Administration to Remove Medical Bills from Credit Scores

Vice President Kamala Harris said on Sept. 14 that the Biden administration has started the process of removing medical bills from people’s credit scores.

The move — set to be done by the Consumer Financial Protection Bureau (CFPB) — will likely improve the credit ratings of millions of Americans. The vice president said gutting medical bills from credit scores and reports will make obtaining a home mortgage or auto loan much easier. The bureau has begun the rulemaking process to make the change official, she said.

“Access to health care should be a right and not a privilege,” Harris, 58, said. “These measures will improve the credit scores of millions of Americans so that they will better be able to invest in their future.”

A March 10, 2022, post on the Peterson-KFF Health System Tracker, “The Burden of Medical Debt in the United States,” reported that 1 in 10 adults or 23 million Americans owe significant medical debt. However, the post said people with disabilities, those in worse health and poor or near-poor adults are more likely to owe significant medical debt. Plus, the post relayed that Blacks, and people living in the South or in Medicaid non-expansion states were also more likely to have major medical debt.

“Research shows that medical bills have little predictive value in credit decisions, yet tens of millions of American households are dealing with medical debt on their credit reports,” said CFPB Director Rohit Chopra. “When someone gets sick, they should be able to focus on getting better, rather than fighting debt collectors trying to extort them into paying bills they may not even owe.”

Additionally, the Biden administration proposal prohibits creditors from using medical bill information when judging loans and discourages coercive collection practices related to medical debt.

Source: Washington Informer

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