ACA Supports Intent of Bill to Remove Paid Medical Debts from Consumers’ Credit Reports


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U.S. Rep. Patrick McHenry reintroduces legislation seeking to improve consumers’ access to credit and amend the Fair Credit Reporting Act. The legislation, with some more research and clarification, could be beneficial for consumers and the accounts receivable management industry.

3/15/2021 15:30

ACA International is supporting several components of legislation that would remove all paid, non-elective medical debt from a consumer’s credit report.

U.S. Rep. Patrick McHenry, R-N.C., ranking member of the House Financial Services Committee, reintroduced H.R. 1645, the Protecting Consumer Access to Credit Act, last week.

It was discussed during the March 11 House Financial Services Subcommittee on Consumer Protection and Financial Institutions hearing, “Slipping Through the Cracks: Policy Options to Help America’s Consumer During the Pandemic.”

The Protecting Consumer Access to Credit Act “would make commonsense reforms to the Fair Credit Reporting Act to ensure accurate and secure credit profiles—a necessity for Americans’ continued economic recovery and future financial success,” according to a news release from McHenry’s office.

“ACA supports several aspects of your legislation, including removing all paid, non-elective medical debt from a consumer’s credit report to help those who have been impacted by illnesses,” ACA CEO Mark Neeb said in a letter to McHenry. “However, we think this legislation might benefit from further clarification on what medical debt is considered non-elective.”

The Protecting Consumer Access to Credit Act would also ensure a consumer found to have been impacted by predatory mortgage, student lending or financial abuse, as determined by a court of law or through a settlement agreement, will have the negative information removed from his or her consumer report. ACA supports this aspect of the bill.

Other elements of the bill include preventing credit reporting agencies from using Social Security numbers for verification purposes; granting the Consumer Financial Protection Bureau authority to oversee the cybersecurity efforts of the credit reporting agencies; and addressing the inefficient process used by credit reporting agencies for a parent to request a security freeze of their child’s credit.

ACA also supports these aspects of the bill but has concerns about preventing the use of Social Security numbers for verification purposes.

“We ask that you conduct some additional outreach on the practical implications of this part of the legislation,” Neeb said. “We share the goal that Fair Credit Reporting Act data should be highly accurate in order to protect consumers and the integrity of the credit ecosystem but believe the Social Security number is an important way to ensure the data is related to the correct consumer.”

Members interested in learning more about ACA’s advocacy strategy and opportunities to connect with state and federal legislators and regulators are invited to attend the Washington Insights Virtual Fly-In April 22.