Last year, we shared the positive news that the Consumer Financial Protection Bureau’s (CFPB) was issuing a new rule to put an end to including a person’s medical debt on their credit reports. The intention was to keep this debt from impeding their ability to get credit and possibly even housing and work. It’s been found that medical debt, which is often unavoidable if someone suffers a serious illness or injury, isn’t an accurate indicator of a person’s creditworthiness.
Since that time, a new administration has come into office, and a lot is changing. CFPB employees have been ordered to stop all work, and the agency is in danger of being closed permanently – although that will require congressional approval. That means there’s no one to enforce the new rule, which technically took effect in March. Further, two members of Congress have proposed legislation to overturn it.
Millions of Americans are mired in medical debt
Others are fighting to save the rule. Some 277 organizations wrote an open letter to Congress reminding them that “more than 100 million people owe at least $220 billion in medical debt, and about 15 million people have medical debt on their credit reports.” Americans are facing overwhelming medical debt because their insurance doesn’t cover the bulk of their medical treatment or they don’t have insurance at all. It’s been calculated that even current and former servicemembers are facing a combined $6 billion in medical debt.
We can’t know what other changes the upcoming few years will bring. If your medical debt is affecting your ability to pay other bills and harming your ability to get needed credit or even to rent a home, it’s wise to look at all of your options for getting your finances back on track. Getting sound legal guidance can help you choose the best one for you.