"Medical debt is unfortunately synonymous with healthcare in the United States. Approximately 41% of Americans have debt for medical or dental bills - meaning they are currently owing a bill, being contacted by a collection agency or actively paying off past balances. Furthermore, an April 2024 report from the Consumer Federal Protection Bureau (CFPB) found that 15 million Americans had medical bills on their credit reports, accounting for a whopping $49 million worth of outstanding debt."
"In January 2025, thanks to Biden-era rulings, the CFPB finalized a rule to free Americans from the weight of medical debt on existing credit reports. Lenders no longer had access to this historic data in credit decisions, including "coding" or contextual data - unless exceptions applied. Fast forward to July 2025, a federal judge in Texas overruled the decision nationally, claiming that the former administration's policy was in violation of the Federal Credit Reporting Act (FCRA)."
"Takeaway #1: There have been no changes to medical debt reporting. First and foremost, consumers and providers alike should know this - nothing has changed with medical debt reporting on a Federal Level. There was not a ban as the CFPB led us to believe on 1/7/25; it was an announcement of a final rule that never took effect. The default federal standard per the Credit Reporting Agencies and FCRA still governs."
Medical debt affects a large portion of the U.S. population, with roughly 41% owing medical or dental bills and 15 million records appearing on credit reports totaling about $49 million. In January 2025 the CFPB finalized a rule aimed at removing most medical debt from credit reports and restricting lender access to related coding and contextual information, with limited exceptions. A federal judge in Texas overturned that rule in July 2025, finding it violated the Federal Credit Reporting Act (FCRA). Current federal practice under the FCRA and credit reporting agencies allows reporting of medical debts over $500 if properly coded after a 365-day delay.
Read at MedCity News
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