Dems Introduce Bill in Senate to Amend FCRA, FDCPA Related to Credit Reporting of Medical Debt

A bill has been introduced in the Senate that would amend both the Fair Credit Reporting Act and the Fair Debt Collection Practices Act to enhance consumer protections related to medical debt.

Senate Bill 1581 was introduced yesterday by Sen. Jeff Merkley [D-Ore.] and is being co-sponsored by Sen. Richard Blumenthal [D-Conn.], Sen. Elizabeth Warren [D-Mass.], Sen. Bob Menendez [D-N.J.], and Sen. Dick Durbin [D-Ill.]. As of Wednesday morning, the full text of the bill was not available on the Senate’s website, but a copy can be read from Sen. Merkley’s website here. The bill is also being supported by the National Consumer Law Center, according to a published report.

The bill would delay reporting of medical debt to an individual’s credit report for one year and would require the removal of medical debt that is paid off or settled from an individual’s credit report within 45 days of doing so.

The bill would also amend the FDCPA to require collectors to send a statement to consumers before reporting unpaid debts to a credit reporting agency. The statement would inform individuals that the debt will not be reported to a credit bureau for one year, starting from when the statement was sent, and if the debt is paid off or settled prior to the end of the one-year period, it will not be reported to a credit bureau.

“Medical challenges should not fatally infect financial health. Americans suffering from injury or illness should be free to focus on their recovery, without financial distraction,” said Sen. Blumenthal in a statement. “Medical debt is not the same as credit card debt—getting injured or sick shouldn’t permanently prevent an American from buying a home or a car.”

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