The CFPB announced that on July 11, 2023 at 10 a.m. EST it will host a hearing on medical billing and collections, with a focus on medical payment products, such as medical credit cards and installment loans. In addition to Director Chopra, the hearing will include agency officials from the White House, the U.S. Department of Health and Human Services, and the U.S. Department of the Treasury.
The CFPB’s announcement states that at the hearing, “[m]embers of the public will have a chance to hear from the CFPB, partner agencies, and organizations on high-cost specialty financial products that are pushed on patients as a way to pay for medical care.”
In May 2023, the CFPB published a report on medical payment products that claimed such products are typically more expensive for patients than other forms of payment, including conventional credit cards. The report also claimed that the deferred interest plans frequently offered as a feature of such products can prove especially expensive and unaffordable for patients.
In April 2023, Equifax, Experian, and TransUnion announced that they removed unpaid medical collections under $500 from consumer credit reports. The three companies, in July 2022, previously removed paid medical collections from credit reports, and extended the delay in medical collection reporting from sixth months after the first delinquency to one year after the first delinquency. In a report issued in April 2023, the CFPB reviewed the impact of the removal of medical collection tradelines based on a sampling of credit reports from 2012-2020 and found that removing medical collection tradelines can significantly improve credit scores and credit availability.
We cannot recall a previous occasion on which a White House representative attended and spoke at a CFPB hearing. Last October, Director Chopra participated in a White House event at which the Administration announced its junk fee initiative. Part of that initiative is a regulation proposed by the CFPB to reduce the safe harbor for credit card late fees from $30 (first late payment) and $41 (all other late payments) to a flat $8. By holding a hearing on medical billing and collections, the CFPB is indicating the importance and priority that it attaches to this issue. And by having a White House representative speak at the event, the CFPB is further underscoring the issue’s significance.
(insideARM editor's note: the hearing is hybrid. You can join in person or watch a livestream. Register here.)