I've known about this for a while and I still expect them to stop using collection agencies calling and start massive small claims court claims or something. I can't imagine this will slide with the current system as it is.
this post was submitted on 07 Jan 2025
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The CFPB said that medical debt is a poor predictor of an individual’s ability to repay a loan. Experian, Equifax and TransUnion, the three national credit reporting agencies, said last year that they were removing medical collections debt under $500 from U.S. consumer credit reports.
So even the credit reporting agencies are recognizing that medical debt isn't reflective of what the credit scores should be. Sounds like more evidence that there is a big problem with healthcare in this country.
Edit: I meant “credit reporting agencies” not “credit unions”
medical collections debt under $500
Who does this cover, like 20 people?
We just got a second notice for a ≈$20 bill that had been paid 3 months ago.
The first notice 3 months ago was for a procedure that was done 7 months prior.
What do you get for 20? A kiss on a boo-boo?
It was a surprise remainder after insurance. We had already paid the office visit copay at time of service.
Such a nice surprise 💝
It happens more often than you’d think. A friend of mine had a ~$25 medical bill go to collections. They just kept setting the mail out, filing it away each week, and forgetting about it. I ended up paying it and convinced them to get tested for ADHD. Sure enough…
Yeah, adhd is the only reason I have any debt at all.
I kinda want to start a company that will manage money for people like me who struggle with keeping up with such things.
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It’s kinda simple: in large cities you can legit just change doctor office and leave behind <500$ per place and just not pay. Most doctor offices are franchised or opened by large hospitals, so the chances of fucking over an individual doctor is pretty slim. In my state, they drop calling after a while and it just disappears once they write it off.
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Medical collections debt under $500
Ah, so, none of them then. That's why this isn't news.
I don't know much about this situation, but it sounds like the reporting agencies took away debt under $500, but the new ban is for any medical debt, not just the debt under $500.
To be clear, that took place last year. This latest move appears much wider-reaching and categorical to any unpaid medical bills. According to the article:
Unpaid medical bills will no longer appear on credit reports, where they can block people from mortgages, car loans or small business loans, according to a final rule announced Tuesday by the Biden administration.
The Consumer Financial Protection Bureau rule will remove $49 billion in medical debt from the credit reports of more than 15 million Americans, according to the bureau, which means lenders will no longer be able to take that into consideration when deciding to issue a loan.
That was what the credit reporting agencies did, not what the Biden administration just did.
Edit: I meant "credit reporting agencies" not "credit unions"
Someone didn't read the article.
That's fair, guilty as charged. I'll go back and read it for real this time.
people this is just crumbs
medical debt gets sold to debt buyers and once that is done it is just debt not medical debt and is not covered by the crumbs the Democrats are throwing
Even if it didn't, even if it worked exactly as intended, it doesn't fix anything. It just moves the problem. Now you're incentivized to focus on paying down other debts because medical debt doesn't hurt your credit. Now you're paying car payments, rent, student loan debt, credit cards, etc. first and medical debt last (if at all). Now hospital prices rocket even higher because even more people aren't making payments, insurance premiums soar further, and absolutely nothing is fixed. The system is broken and it's not because of credit scores.
We need to solve medical debt by addressing the source of the problem. Insurance. At minimum we need a public option. Better still, Medicare for all. Medical care should be socialized. Health is not capital. The threat of crippling debt or injury, disease and death without treatment should not be a profit generator for the protection racket that is insurance.
Basset Healthcare literally outsourced their ~~bumming~~ billing department to a debt collection agency. We waited months for a bill, found out they were in the process of switching and then got a very aggressive letter stating we were delinquent.
:: Left the typo in there because it's technically correct.
Yes however medical debt is covered under hipa. When the debt agencies buy your medical debt they are violating hipa laws. There are a lot of strategies for eliminating this type of debt without ever paying it. Usually simply asking for debt verification is enough to get it removed from your credit report.
My strategy of literally ignoring collectors and sending all their calls to voicemail (for a surgery done in early 2023 in which I owed a couple thousand dollars) actually worked. I was called once a week or so for a little over a year and I haven't been contacted since June 2024.
I believe I was dinged on my credit score but the penalty was low single-digits, and it didn't affect my eligibility to buy a house. Your mileage will vary, and I definitely can't in good conscience recommend this as your first resort. Talk to a professional about risks and benefits of not paying certain debts if you can't or don't want to pay; some debts are not optional. But yeah, some are.
The strategy that seems to work the best is just to never interact with the debt from the start, it becomes almost impossible for them to collect.
This is the second time I've heard this in as many days... do you have any sources I could look at?
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Just give us Medicare for all. All of this does is shift the burden of unpaid bills to providers who in turn raises prices on everybody else.
Because spending bills need to originate in the House and pass the Senate.
If everyone else stopped paying, how long do you think it would take for them to move us to Medicare for All?
Yeah if that happened they'd just make it so it can be discharged through bankruptcy like student loans
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Because Trump is going to undo it right away.
The point of those things is that by doing that, he'll more directly impact his own supporters who likely vary the maturity of that debt in the gimme gimme red states that take a lot more than they contribute while complaining about nebulous "handouts" that really piss them off
Yeah they don't care. They didn't care last time and they won't this time.
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While this is a good thing, holy hell does it show the absolutely horrible state of health care in the US. Medical bills that can ultimately end a life (in a financial sense) simply should not exist.
But we clearly can't fix the for-profit system, so we band-aid it by excluding the unpaid bills from credit reports.
Meanwhile, the incoming US President wants to fix health care by "privatization". Someone should let him know that the system is (mostly) privatized already, which is the entire problem.
(Edit: last bit /s. He clearly knows, but wants to make him and his cronies even more money)
How is this not bigger news?!
Americans are so propagandized and uninformed that we RE-ELECTED an anti-democratic felon rapist to be our leader. People don't know about this because their radicalized personalized feeds won't show them.
Yes, this is huge.
Yes, it's probably going to be the last good news we get from our political arena in a long, long time. Americans chose the path of regression. We won't see anything positive like this for the foreseeable future.
Biden's age isn't looking like too big of a deal now, is it? Especially since the rapist is essentially the same age.
Americans are so propagandized and uninformed that we RE-ELECTED an anti-democratic felon rapist to be our leader. People don’t know about this because their radicalized personalized feeds won’t show them.
This, Americans are so forgetful that they went from hating Trump and seeing him as the ultimate evil back to... thinking he was a "breath of fresh air, challenging the status quo" in four years
Yup. Americans are basically hamsters. Every day is a new day and you don't have to take the past into consideration. Just throw a dart at a board to decide your fate every day.
Yeah but thats only like 15% of people who have voted.
35% of voters were always going to vote for Trump, they never hated him.
That's nice! They told me I was going to be chosen to go to the moon. I didn't get to go, but they made a really good joke in my honor! So nice!
They didn't erase my partner's school loans but maybe they might send us a postage stamp in honor of school loan survivors?
Oh, good. This way we'll be able to borrow more money to try to pay off the medical debt and dig ourselves into a deeper hole. Perfect.
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