ACA International’s advocacy team met with the committee this week to discuss the challenges of medical debt and legislation that could strike a better balance for businesses and consumers. Editor’s note: This content is available for members only.
12/12/2019 10:30
Following a markup Dec. 11, the House Financial Services Committee advanced legislation that would delay medical debt collections and credit reporting.
ACA International has been advocating for the accounts receivable management industry and members on this bill and met with legislators on the committee Dec. 12. ACA also submitted a letter to the committee in advance of its November markup on the legislation and several other proposals related to debt collection.
H.R. 5330, the Consumer Protections for Medical Debt Collections Act, sponsored by U.S. Rep. Rashida Tlaib, D-Mich., prevents collection of medical debt for two years from the date of the medical billing. It also includes a one-year delay before adverse information is reported to a consumer reporting agency, and it would ban the reporting of debt arising out of medically necessary procedures, according to a news release from the committee. The bill passed by a 31-24 vote.
The stated purpose of this bill is to bar entities from collecting medical debt or reporting it to a consumer reporting agency without giving a consumer notice about their rights under the Fair Debt Collection Practices Act and Fair Credit Reporting Act related to that debt, including a minimum one-year delay before adverse information is reported to a consumer reporting agency.
“ACA appreciates the intent of this bill in regard to treating medical debt differently, since consumers often do not choose to get sick or take on medical debt,” said CEO Mark Neeb in the letter to the committee. “However, the one-year delay for credit reporting is not in line with other legislation and research on this issue, which instead has a closer to 180-day minimum period prior to delay credit reporting. The arbitrary one-year time period could have unintended consequences that have a global impact on the accuracy of the credit rating system and the ability of creditors to accurately access a consumer’s creditworthiness.”
ACA staff also discussed concerns with the committee that delaying reporting for a year could have an impact on consumers seeking charity care and other opportunities for reduced fees or cost.
ACA urges Congress to work with the accounts receivable management industry on legislation which strikes a better balance of recognizing the unique nature of medical debt, while ensuring that a functioning credit-based economy and consumers, are not impacted by unintended consequences of this bill.