What This Bill Does
This bill changes how debt collectors can pursue medical debt and how credit reporting agencies can report it. It adds a 2-year waiting period before debt collectors can try to collect medical debt from consumers. It also prevents credit reporting agencies from including certain medical debts on credit reports.
Who It Affects
Debt collectors, credit reporting agencies (companies that track payment history), people who owe medical debt, insurance companies, and the Director of the Bureau (a federal official).
Key Provisions
• Debt collectors cannot try to collect medical debt before 2 years after the first payment is due. (Sec. 2(b))
• Credit reporting agencies cannot report any debts from medically necessary procedures on credit reports. (Sec. 3(b))
• Credit reporting agencies cannot report other medical debts for at least 365 calendar days after the debt is placed for collection or charged to profit or loss. (Sec. 3(b))
• Before reporting medical debt, the person furnishing the information must send the consumer a statement explaining the debt may not appear on credit reports and that the consumer can seek insurance coverage or financial assistance. (Sec. 4(a))
• If a medical debt is settled or paid before 365 days pass, it cannot be reported to credit reporting agencies. (Sec. 4(b))
What Changes
Debt collectors must wait 2 years before attempting to collect medical debt. Credit reporting agencies will be prohibited from reporting debts from medically necessary procedures and must wait at least 365 days before reporting other medical debts. Consumers will receive notices explaining these protections before medical debt information is shared.
Important Definitions
"Medical debt" means a debt from receiving medical services, products, or devices. "Medically necessary procedure" means health care services needed to diagnose, treat, or prevent illness or disease that meet accepted standards of medicine, including preventive services like flu shots and screening mammograms.
Effective Date
180 days after the bill becomes law. (Sec. 5)
I
118TH CONGRESS
1ST SESSION H. R. 1773
To amend the Fair Debt Collection Practices Act to provide a timetable
for the collection of medical debt by debt collectors, to amend the Fair
Credit Reporting Act to prohibit consumer reporting agencies from
issuing consumer reports containing information about debts related to
medically necessary procedures, and for other purposes.
IN THE HOUSE OF REPRESENTATIVES
MARCH 23, 2023
Ms. TLAIB introduced the following bill; which was referred to the Committee
on Financial Services
A BILL
To amend the Fair Debt Collection Practices Act to provide
a timetable for the collection of medical debt by debt
collectors, to amend the Fair Credit Reporting Act to
prohibit consumer reporting agencies from issuing con-
sumer reports containing information about debts related
to medically necessary procedures, and for other pur-
poses.
Be it enacted by the Senate and House of Representa-
1
tives of the United States of America in Congress assembled,
2
SECTION 1. SHORT TITLE.
3
This Act may be cited as the ‘‘Consumer Protection
4
for Medical Debt Collections Act’’.
5
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•HR 1773 IH
SEC. 2. AMENDMENTS TO THE FAIR DEBT COLLECTION
1
PRACTICES ACT.
2
(a) DEFINITION.—Section 803 of the Fair Debt Col-
3
lection Practices Act (15 U.S.C. 1692a) is amended by
4
adding at the end the following:
5
‘‘(9) The term ‘medical debt’ means a debt
6
arising from the receipt of medical services,
7
products, or devices.’’.
8
(b) UNFAIR PRACTICES.—Section 808 of the Fair
9
Debt Collection Practices Act (15 U.S.C. 1692f) is amend-
10
ed by adding at the end the following:
11
‘‘(9) Engaging in activities to collect or at-
12
tempting to collect a medical debt owed or due
13
or asserted to be owed or due by a consumer,
14
before the end of the 2-year period beginning
15
on the date that the first payment with respect
16
to such medical debt is due.’’.
17
SEC. 3. PROHIBITION ON CONSUMER REPORTING AGEN-
18
CIES REPORTING CERTAIN MEDICAL DEBT.
19
(a) DEFINITION.—Section 603 of the Fair Credit Re-
20
porting Act (15 U.S.C. 1681a) is amended by adding at
21
the end the following:
22
‘‘(bb) MEDICAL DEBT.—The term ‘medical debt’
23
means a debt arising from the receipt of medical services,
24
products, or devices.
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‘‘(cc) MEDICALLY NECESSARY PROCEDURE.—The
1
term ‘medically necessary procedure’ means—
2
‘‘(1) health care services or supplies needed to
3
diagnose or treat an illness, injury, condition, dis-
4
ease, or its symptoms and that meet accepted stand-
5
ards of medicine; and
6
‘‘(2) health care to prevent illness or detect ill-
7
ness at an early stage, when treatment is likely to
8
work best (including preventive services such as pap
9
tests, flu shots, and screening mammograms).’’.
10
(b) IN GENERAL.—Section 605(a) of the Fair Credit
11
Reporting Act (15 U.S.C. 1681c(a)) is amended by adding
12
at the end the following new paragraphs:
13
‘‘(9) Any information related to a debt arising
14
from a medically necessary procedure.
15
‘‘(10) Any information related to a medical
16
debt, if the date on which such debt was placed for
17
collection, charged to profit or loss, or subjected to
18
any similar action antedates the report by less than
19
365 calendar days.’’.
20
SEC. 4. REQUIREMENTS FOR FURNISHERS OF MEDICAL
21
DEBT INFORMATION.
22
(a) ADDITIONAL NOTICE REQUIREMENTS FOR MED-
23
ICAL DEBT.—Section 623 of the Fair Credit Reporting
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Act (15 U.S.C. 1681s–2) is amended by adding at the end
1
the following:
2
‘‘(f) ADDITIONAL NOTICE REQUIREMENTS FOR MED-
3
ICAL DEBT.—Before furnishing information regarding a
4
medical debt of a consumer to a consumer reporting agen-
5
cy, the person furnishing the information shall send a
6
statement to the consumer that includes the following:
7
‘‘(1) A notification that the medical debt—
8
‘‘(A) may not be included on a consumer
9
report made by a consumer reporting agency
10
until the later of the date that is 365 days
11
after—
12
‘‘(i) the date on which the person
13
sends the statement;
14
‘‘(ii) with respect to the medical debt
15
of a borrower demonstrating hardship, a
16
date determined by the Director of the Bu-
17
reau; or
18
‘‘(iii) the date described under section
19
605(a)(10); and
20
‘‘(B) may not ever be included on a con-
21
sumer report made by a consumer reporting
22
agency, if the medical debt arises from a medi-
23
cally necessary procedure.
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‘‘(2) A notification that, if the debt is settled or
1
paid by the consumer or an insurance company be-
2
fore the end of the period described under paragraph
3
(1)(A), the debt may not be reported to a consumer
4
reporting agency.
5
‘‘(3) A notification that the consumer may—
6
‘‘(A) communicate with an insurance com-
7
pany to determine coverage for the debt; or
8
‘‘(B) apply for financial assistance.’’.
9
(b) FURNISHING
OF
MEDICAL
DEBT
INFORMA-
10
TION.—Section 623 of the Fair Credit Reporting Act (15
11
U.S.C. 1681s–2), as amended by subsection (a), is further
12
amended by adding at the end the following:
13
‘‘(g) FURNISHING
OF MEDICAL DEBT INFORMA-
14
TION.—
15
‘‘(1) PROHIBITION
ON
REPORTING
DEBT
RE-
16
LATED TO MEDICALLY NECESSARY PROCEDURES.—
17
No person shall furnish any information to a con-
18
sumer reporting agency regarding a debt arising
19
from a medically necessary procedure.
20
‘‘(2) TREATMENT OF OTHER MEDICAL DEBT IN-
21
FORMATION.—With respect to a medical debt not
22
described under paragraph (1), no person shall fur-
23
nish any information to a consumer reporting agen-
24
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•HR 1773 IH
cy regarding such debt before the end of the 365-
1
day period beginning on the later of—
2
‘‘(A) the date on which the person sends
3
the statement described under subsection (f) to
4
the consumer;
5
‘‘(B) with respect to the medical debt of a
6
borrower demonstrating hardship, a date deter-
7
mined by the Director of the Bureau; or
8
‘‘(C)
the
date
described
in
section
9
605(a)(10).
10
‘‘(3) TREATMENT OF SETTLED OR PAID MED-
11
ICAL DEBT.—With respect to a medical debt not de-
12
scribed under paragraph (1), no person shall furnish
13
any information to a consumer reporting agency re-
14
garding such debt if the debt is settled or paid by
15
the consumer or an insurance company before the
16
end of the 365-day period described under para-
17
graph (2).
18
‘‘(4) BORROWER
DEMONSTRATING
HARDSHIP
19
DEFINED.—In this subsection, and with respect to a
20
medical debt, the term ‘borrower demonstrating
21
hardship’ means a borrower or a class of borrowers
22
who, as determined by the Director of the Bureau,
23
is facing or has experienced unusual extenuating life
24
circumstances or events that result in severe finan-
25
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•HR 1773 IH
cial or personal barriers such that the borrower or
1
class of borrowers does not have the capacity to
2
repay the medical debt.’’.
3
SEC. 5. EFFECTIVE DATE.
4
This Act and the amendments made by this Act shall
5
take effect on the date that is 180 days after the date
6
of enactment of this Act.
7
Æ
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