Legislation Would Help Ensure Medical-Debt Accuracy in Credit Reports

Legislation Would Help Ensure Medical-Debt Accuracy in Credit ReportsIt’s aptly called the “Accuracy in Reporting Medical Debt Act” — a bill introduced last week by Rep. Gary Miller, R-California and Rep. Carolyn McCarthy, D-New York, that would give consumers 120 days to resolve medical bills with collectors before that debt is reported to Equifax, Experian or TransUnion.
Debt collectors would have to delay reporting the debt to the bureaus if the consumer can show that he or she is continuing to work with an insurance company; was unaware that the debt existed or disputes owing the debt; or has applied for financial assistance.
Minor billing and processing errors for medical services can have major consequences for an individual’s credit score, Miller said in a statement.
Unpaid medical debt that is reported to credit bureaus — “regardless of whether it is under $100, erroneous, or disputed” — can shave up to 100 points off an individual’s credit score.
He said the bill — actually an amendment the Fair Debt Collection Practices Act — would give consumers the time to reconcile their medical debt and “pay what they truly owe for a medical procedure.”
Debt collectors would initially give alleged debtors 30 days to respond. If there is no response within 30 days, the collector could report the debt to the credit bureaus. The 30-day period is included in the 120-day timeline.
The law does not prevent the collectors from continuing to attempt to get your money during the waiting period; they just can’t tell the credit bureaus about it.
“Every year, families in my district, and across the country, are hit with confusing and costly medical bills,” said Miller. “The personal and financial toll of dealing with a medical emergency or serious illness is difficult enough. Unfortunately, for many patients and their families, our nation’s complex and broken healthcare system inflicts additional pain by damaging their ability to access credit.”

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