Gluesenkamp Perez and Magaziner Urge CFPB to Remove Medical Debt from Credit Reports

Dec 06, 2023

Today, Rep. Marie Gluesenkamp Perez (WA-03) and Rep. Seth Magaziner (RI-02) led 57 Members of Congress in a letter urging the Consumer Financial Protection Bureau (CFPB) to move swiftly to prevent creditors from using information about Americans’ medical debt to determine credit worthiness.

Medical debt is not a reliable predictor of overall financial well-being, and unfair debt collection and coercive credit reporting practices have put a financial strain on millions of Americans. A diminished credit score caused by medical debt could make it more difficult for working people to get a job, buy a house or car, or start a small business.

“People don’t have control over falling ill or becoming injured, so their credit score shouldn’t be tanked for having to take on medical debt. Experiencing a health crisis isn’t an informative measure of financial well-being, nevertheless the resulting credit impacts put folks’ financial futures at risk,” said Rep. Gluesenkamp Perez. “CFPB’s proposed rule to end unfair debt reporting practices would make life easier for families in Southwest Washington who might already be facing the immense strain of a medical emergency.”

“A medical emergency should not destroy your credit and financial future, but for millions of Americans with medical debt from unexpected health care costs, this is the reality,” said Rep. Magaziner. “We must end unfair debt reporting practices to provide some much-needed breathing room for working people saddled with medical debt in Rhode Island and across the country.”

“While medical debt currently impacts people’s credit like other debt, people do not have control over whether they get sick or injured and are forced to take on medical debt. In fact, two thirds of medical debt is the result of a one-time or short-term medical expense arising from an acute medical need,” the lawmakers wrote. “Medical debt is not an accurate predictor of a person’s credit worthiness and should not impact their ability to access credit and build for the future.”

Full text of the letter can be found here.

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