Frigid temperatures this weekend prompt cold weather advisories

MPR News helps you turn down the noise and build shared understanding. Turn up your support for this public resource and keep trusted journalism accessible to all. 

Turn Up Your Support

The Trump administration is moving to overrule any state laws that may protect consumers’ credit reports 

The Consumer Financial Protection Bureau has drafted what’s known as an interpretative rule related to the Fair Credit Reporting Act, interpreting the law in a way that says the FCRA should preempt any state laws or regulations when it comes to how debt should be reported to the credit bureaus like Experian, Equifax and Trans Union.

 that allowed states to implement their own credit reporting bans. More than a dozen states like New York and Delaware prohibit the reporting of medical debt on a consumers’ credit report.

Medical debt is often the most disputed part of a consumer’s credit report, because insurance payments can take time, and oftentimes 

 the means to fully pay a medical bill if 

 a procedure that has already taken place.

The three credit bureaus jointly announced in 2023 they would no longer track any medical debts below $500, which at the time the bureaus said would eliminate 70 percent of all medical debts reported on 

 have gone further than that. New York, Delaware and others passed laws where medical debts can no longer be reported to the credit bureaus.

The CFPB, which is largely not operating at the moment with the exception of actively repealing previous rules written under President Biden or earlier, says in its rule that Congress intended to “create national standards for the credit reporting system” under the FCRA and state laws run afoul of that intention.

The Kaiser Family Foundation estimates that Americans owe roughly $220 billion in medical debt. In Republican-controlled states like South Dakota, Mississippi, West Virginia and Georgia, roughly one in six Americans have outstanding medical debt, according to the KFF.

Having outstanding, delinquent medical debt can impact the ability for an individual to apply for a mortgage, a credit card or an auto loan.

A spokesperson for the Bureau did not immediately respond to a request for comment.

Health

Politics and Government News

Homepage

The Associated Press

Author

The Trump administration is moving to overrule state laws that protect consumers’ credit reports from medical debt. The Consumer Financial Protection Bureau has drafted an interpretative rule related to the Fair Credit Reporting Act.

Trump administration moves to overrule state laws protecting credit reports from medical debt

Go Deeper.

Like this?