From Collector: Reporting for Duty

FCRA amendments related to veterans’ medical debts go into effect May 24, 2019.

4/26/2019 8:30 AM

NewsCollector Magazine
From Collector: Reporting for Duty

In May 2018, Congress passed the Economic Growth, Regulatory Relief, and Consumer Protection Act, which includes amendments to the Fair Credit Reporting Act providing special provisions for the reporting of medical debts owed by veterans.

The amendments aim to correct the issues surrounding the reporting of veterans’ medical debt. The amendments include a definition of veterans’ medical debt, exclusions for veterans’ medical debt, a dispute process for veterans’ medical debt, the creation of a database to determine whether a debt is a veteran’s medical debt and provisions for credit monitoring for active duty military consumers. Data furnishers who furnish medical information will want to review their accounts and take the proper steps to ensure their treatment of veterans’ medical debt follows these amendments, ACA International’s Compliance Analyst Laura Dadd reports in the April issue of Collector magazine.

For data furnishers of medical information, the act defines a “veteran’s medical debt” as “a medical collection debt of a veteran owed to a non-Department of Veterans Affairs health care provider that was submitted to the Department for payment for health care authorized by the Department of Veterans Affairs; and … includes medical collection debt that the Department of Veterans Affairs has wrongfully charged a veteran.”

Under the National Consumer Assistance Plan, medical debt cannot be reported until it is at least 180 days past due. However, the FCRA amendment mandates that a veteran’s medical debt cannot be reported until the debt is a year past due. The act requires medical debts less than one year old to be removed from the veteran’s credit report. Also, any veteran’s medical debt that was delinquent, charged off or in collections must be removed once the debt is fully paid or settled.

The amendments provide a method of dispute for veteran’s medical debt. If veterans dispute this type of medical debt and provide proof of liability of the Department of Veteran Affairs for payment of the debt, the CRA must delete all information relating to the veteran’s medical debt and notify the furnisher of the deletion.

The secretary of Veterans Affairs must create a database to allow CRAs to verify whether a debt furnished to a consumer reporting agency is a veteran’s medical debt. The database must be established one year after the date of enactment. The database must provide sufficiently detailed information to verify whether a furnished debt is a veteran’s medical debt. This will allow the CRAs to verify a debt’s status as a veteran’s medical debt.

Finally, the act requires consumer reporting agencies to provide credit monitoring to active-duty military consumers, which includes members of the National Guard. The credit reporting agency will be required to provide free electronic credit monitoring service that at minimum notifies a consumer of material addition or modification to their credit report. In order to receive this service, the consumer must provide the CRA proof that she is on active military duty and provide her contact information.

Data furnishers who furnish medical debt will want to review their policies and procedures to make sure they follow the new amendments.

It may be prudent to review any medical accounts to determine if they fall under the definition of a “veteran’s medical debt.” If some accounts do meet the definition, data furnishers may want to flag these accounts and determine how to handle them.

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