15 million Americans still harmed by medical debt despite credit agencies’ changes

Americans are delaying medical care because of rising medical costs. (iStock)

The CFPB said that despite changes to the way medical debt is reported, millions of Americans continue to have their credit damaged by medical debt. report.

To support those facing unexpected hospitalization costs, Equifax, Experian, TransUnion Last year, we took steps to remove nearly 70% of collected medical debt from credit reports. The companies announced that they will extend the time period for medical bills under collection to appear on your credit report from 180 days to one year. Additionally, medical bills that were in collections but have been resolved will no longer appear on your credit report, and medical debts under $500 will be excluded.

Although medical debt appears less frequently on credit reports, the CFPB estimates that approximately 15 million Americans still have more than $49 billion in unpaid medical bills on their credit reports. said. The main reason is that this change only helps remove small balances. As a result, the average balance of remaining medical expenses reported on credit reports increased from $2,000 to more than $3,100, according to the CFPB.

“Experian, Equifax, and TransUnion have recognized that medical bills have little predictive value and have taken steps to remove many medical bills,” said CFPB Director Rohit Chopra. Ta. “The latest findings highlight the impact of these changes and the need for further reforms.”

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The bill proposes to eliminate all medical debt.

Sen. Bernie Sanders (D-Vermont) and Sen. Jeff Merkley (D-Oregon) proposed a new bill The goal is to eliminate $220 million in medical debt and have it wiped from his credit report.

The bill would create a federal grant program to cancel medical debt, prioritizing under-resourced health care providers and vulnerable populations. It would amend the Fair Debt Collection Practices Act to make it illegal to collect on past medical debt claims.

The bill would also update billing and debt collection requirements for health care providers to limit the potential for future debt. It also proposes to amend the Consumer Credit Reporting Act to prevent credit agencies from reporting information related to unpaid medical bills.

“Medical debt and aggressive collection practices delay patients’ needed care and destroy the trust necessary for healing,” said Luke Meshack, an emergency physician and historian at Harvard Medical School. “Most health care providers don’t want to be part of a system that causes such damage to patients’ lives. This bill will help prevent this damage by canceling debt, improving access to financial assistance, and preventing medical bills from damaging credit scores.”

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This is how Americans paid their medical bills

As prices rise, 68% of Americans say they can’t afford to pay their medical bills on time, and 48% say they are delaying medical care due to rising costs, according to a recent AccessOne survey. investigation.

Nearly one-third of consumers say they are “not at all confident” they could afford a medical bill over $500. To pay for medical bills, 10% of Americans have had to pay out of pocket, and 32% have used a credit card when their income was insufficient.

“In a market where short-term banking trends are squeezing credit access and trends towards longer-term benefit design are making it increasingly costly for consumers, providers with transparent and affordable repayment options are winning share,” AccessOne CEO Mark Spinner said.

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