Biden administration announces a plan for removing medical debt from credit reports

The Biden administration, through the Consumer Financial Protection Bureau (CFPB), has proposed new federal regulations to remove medical debt from credit reports. If implemented, these rules would protect millions of Americans struggling with unaffordable medical bills. Vice President Kamala Harris emphasized that no one should be denied economic opportunities due to medical emergencies. The administration also urged states to restrict hospital debt collection practices and enhance charity care for low-income patients. The new regulations aim to eliminate the inclusion of medical and dental bills on credit reports, which currently affect around 15 million people, predominantly in low-income Southern communities. Despite voluntary changes by major credit agencies like Equifax, Experian, and TransUnion, many patients with large medical debts remain impacted. Critics of the proposal, including hospital and debt collection industry leaders, warn it could lead to upfront payment requirements for medical services. However, consumer advocates continue to push for stronger protections against aggressive medical debt collection practices. Public comments on the proposal will be reviewed through the year, with a final rule expected early next year.

Source: NPR