A medical debt credit reporting bill has been passed by the Washington state Senate and is one step closer to becoming law.
Driving the news: The Washington State Senate approved S. 5480 in a bipartisan vote. The bill, sponsored by Sen. Marcus Riccelli, a Democrat, would prohibit medical debt from being reported to consumer credit agencies, aiming to shield consumers from the financial consequences of unpaid medical expenses.
Why it matters: The bill seeks to protect Washington residents from the long-term financial impact of medical debt, which can negatively affect credit scores and limit access to loans, housing, and employment opportunities.
Key details:
- Prohibition on reporting medical debt: The bill amends existing Washington laws to prevent collection agencies, health care providers, and other entities from furnishing medical debt information to credit reporting agencies.
- Legal consequences: Medical debt that is reported in violation of this law would be deemed void and unenforceable. The legislation also classifies violations as unfair or deceptive acts under the Washington Consumer Protection Act.
- Impact on credit reports: The bill modifies RCW 19.182.040 to ensure that medical debt is excluded from consumer credit reports, aligning with recent federal regulatory efforts by the Consumer Financial Protection Bureau.
What they’re saying:
Sen. Riccelli emphasized the burden of medical debt, stating, “Nearly one in three families in Washington have someone struggling with medical debt. No one chooses to get sick or have a medical emergency, but medical debt affects credit scores, which can make it difficult to get a car or home loan, rent an apartment, or find a job.”
What’s next: The bill now moves to the Washington House of Representatives for further debate and potential approval.
