The comments period regarding the Consumer Financial Protection Bureau’s proposed rule that would prohibit creditors from using medical debts when determining whether a consumer is eligible for credit closed yesterday. To provide insight into the tone of the comments being filed, AccountsRecovery.net is sharing some of those comments here. To date, 1,008 comments have been filed and are available to be viewed. Here is a summary of some of the complaints that have been submitted. Click on the arrow next to a summary to read the full comment. In some browsers, there is no arrow next to the summary. In that case, just click on the text to view the entire comment.
We appreciate the CFPB’s interest in addressing the hardships of medical debt; however, we believe that the Proposed Rule does not contain sufficient guardrails to protect the viability of small or rural practices. The Proposed Rule fails to acknowledge that many practitioners already have flexible post-service collection processes and work diligently with patients to find a reasonable payment solution. During this process, practices often absorb medical debt costs. For a large provider—such as a hospital—this may be a sustainable process. However, this process may impose a considerable burden on small or rural practices.
Comment from Advocacy Council of the American College of Allergy, Asthma and Immunology
Comment from Jennifer Whipple
The Proposed Rule will not provide the economy or consumers the benefit that the CFPB is looking for. This proposal will lead to additional wait times at a doctors office before a visit, closure of doctor offices, reduction in future medical staff and students seeking education in the medical field, requirements of cash at time of service, consumers waiting for services or procedures until they have the monies to pay up front, increased use of emergency room visits at hospitals for both emergent and non-emergent care, reduced access to credit for all U.S. consumers, increased delinquency and charge-off rates for creditors and more. I urge the CFPB to put a hold on this proposed rule, conduct studies and if it finds viable alternatives, to start anew with a new proposal and SBREFA process.
Comment from Meduit
Please DO NOT adopt the Proposed Rule on Credit Reporting. I am uniquely positioned as both an individual consumer / patient affected by this rule as well as an individual who depends on the payment of medical debt services to pay my own bills as I work for a receivables management company. With those two perspectives, I will be impacted by this rule on multiple levels and from the facts that have been presented, I see many more negative impacts to my future rather than benefits from this rule.
Whether it is my ability as an individual to obtain healthcare services without having to pay for them in full ahead of time and have providers within a reasonable distance from my home to guarantee services in emergencies, or the fact that my livelihood is potentially at risk as I depend on the consumers’ payment of their outstanding medical debt to pay my own bills. I do not believe that all the impacts of this change have been fully considered. Of course, as an individual consumer I can get excited about the talking points of never seeing a medical debt on my credit report again, but as I understand each of the larger economic and healthcare related impacts that I will be faced with after the implementation, the small “win” on my credit will not be worth the loss of my future larger goals and growth.
Please consider the numerous unintended negative consequences this proposed regulation would have on patients, financial consumers, the healthcare system and the broader economy. Thank you for your consideration.
Comment from Debt.com
Debt.com has surveyed more than 1,000 Americans on their medical debt annually for the past five years. The percentage who’ve told us “inflation has made it harder to pay their medical bills” has jumped 22% over the past three years.
The number who have medical bills in collections has nearly doubled since 2022. The same for the percentage of Americans who avoid medical care because of their medical debt.
If the CFPB has data that medical bills are “often inaccurate or inflated” – what protective policies does the CFPB have planned to help these Americans get the medical care they need? No one should avoid treatments that can potentially save their lives out of fear of affordability.
Comment from the American Medical Association
The AMA appreciates the CFPB’s proposals that would prohibit creditors from obtaining or using medical information related to debts, expenses, assets, or collateral, in connection with a credit eligibility determination, unless a specific exception otherwise applies to the creditor’s consideration of the medical information. We also appreciate that, under the proposal, consumer reporting agencies would be prohibited from furnishing to a creditor a consumer report containing medical debt information in connection with a credit eligibility determination. The AMA applauds CFPB’s recognition of the public health impacts of medical debt and the continued efforts to mitigate these effects. These proposals, if finalized, will be an important step towards reducing the financial impact on patients and physicians.
Comment from the Orthotic and Prosthetic Alliance
The O&P Alliance supports the Proposed Rule’s provisions that would prohibit lenders from taking medical devices—such as a wheelchair, orthosis, or prosthesis—as collateral for a loan, or repossessing medical devices when an individual is unable to repay a loan. According to our experience, this is a very rare occurrence with respect to orthotics and prosthetics. There is little intrinsic value to a custom fit or fabricated orthosis or prosthesis that is worn daily by the person it was designed for, and cannot be reused by another person. In our view, repossession of an orthosis or prosthesis or holding the device as collateral for a loan is punitive and exacts unreasonable retribution on an individual who is financially unable to pay.
Comment from the American Institute for Economic Research
The outcome of this regulation would be the generation of “information asymmetry,” where potential borrowers would have more information than potential lenders. Potential lenders would know of this information asymmetry and reasonably fear “adverse selection,” where borrowers could take advantage of undisclosed medical information to benefit from an exchange with potential lenders. This adverse selection would mean lenders may be hesitant to lend to some borrowers, impose higher interest rates, or leave the marketplace altogether. The more lenders leave the market, the more competition is reduced, raising borrowing costs and reducing the number and type of market participants – to the detriment of borrowers.
Comment from Amy Crews Cutts
The Consumer Data Industry Association hired me through counsel to provide my opinion concerning the economic analyses and empirical evidence cited in the Consumer Financial Protection Bureau’s Proposed Rule on the Prohibition on Creditors and Consumer Reporting Agencies Concerning Medical Information (Regulation V). I am being compensated for the time I spent researching and drafting this report. My opinions are my own.
While it may be socially unjust that consumers with medical debt are burdened by their circumstances, it is not accurate to claim that empirical evidence shows that, especially in the current credit environment, medical debt is not predictive of future borrower performance and that it is not necessary and appropriate for creditors to obtain or consider medical debt information as part of the credit decision process. The opposite is closer to the truth. It is not fair for the CFPB to try to mitigate the perceived unfairness against those with medical debt by imposing a system that unjustly denies credit-worthy consumers without medical debt the credit they deserve.
Comment from Equifax
Equifax Medical Information Comment Letter — 8.12.2024
Equifax’s analysis of CFPB’s prohibition on creditors and CRAs concerning medical information finds the proposed rule to be arbitrary and capricious. …
Equifax Medical Information Comment Letter — 8.12.2024
In fact, the proposed rule masks the issue by preventing potential lenders from understanding a potential borrower’s complete credit profile. More significantly, the proposed rule is arbitrary and capricious as CFPB inappropriately interprets the FCRA and fails to provide sufficient support for its decision. For the reasons outlined in this letter, we urge CFPB to withdraw the proposed rule and work with Congress to resolve the underlying problem of medical debt.
