The bureau restored a provision of the 1970 Fair Credit Reporting Act.
The Consumer Financial Protection Bureau (CFPB) issued a final rule to block credit reports from including debt accrued through medical bills.
“People who get sick shouldn’t have their financial future upended,” CFPB Director Rohit Chopra stated. “The CFPB’s final rule will close a special carveout that has allowed debt collectors to abuse the credit reporting system to coerce people into paying medical bills they may not even owe.”
This rule restores a provision originally implemented under the Fair Credit Reporting Act of 1970, overriding an exemption made to the act in the early 2000s allowing consumer reporting agencies to access and share medical information. The rule does not eliminate a person’s medical debt, but does prevent it from impacting one’s credit score.
Financial and medical debt experts support this move since many forms of debt, such as car loans and mortgages, are planned. Medical debt is often accrued suddenly and unexpectedly, making it a less reasonable inclusion in a report of individual debt management.
A trade association and credit union group has sued to block the rule on the grounds that the CFPB has exceeded its authority in creating it.
As the Lord Leads, Pray with Us…
- For Director Chopra to be prudent as he heads the Consumer Financial Protection Bureau.
- For U.S. financial and economic officials as they seek to protect Americans from predatory credit practices.
Sources: The Hill, Forbes, MarketWatch
