New CFPB Bulletin Addresses Illegal Medical Debt Collection and Credit Reports


On January 13, 2022, the CFPB issued a bulletin to remind debt collectors of their obligations under the No Surprises Act, which protects consumers against certain unexpected medical bills. The bulletin reminds businesses that if they attempt to collect prohibited debts, they expose themselves to potential liability under the Fair Debt Collection Practices Act (FDCPA) and the Fair Credit Reporting Act (FCRA).

The law without surprise protects participants, beneficiaries and enrollees of group health plans and individual health insurance coverage against surprise medical bills associated with certain emergency services, non-emergency services from non-participating providers and air ambulance services. It also requires certain healthcare facilities to disclose federal and state patent protections against balance billing and includes protections for the uninsured (or self-paid).

“Too many Americans have been shocked by surprise medical bills and forced to pay under credit report duress,” CFPB Director Rohit Chopra said. “Our action today should remind us not to collect or provide credit information on invalid medical debt.”

“The Unsurprising Act is the most critical consumer protection law since the Affordable Care Act,” said Xavier Becerra, Secretary of Health and Human Services (HHS). “After years of bipartisan efforts, we are finally providing hard-working Americans with the federal guardrails needed to protect them from surprise medical bills. We get patients out of the middle of the food battle between insurers and providers and ensure they are not faced with eye-watering, bankruptcy-inducing medical bills. It’s the right thing to do, and it supports President Biden’s vision to create a more transparent, competitive, and equitable health care system.

The bulletin includes the following reminders to debt collectors, information providers and credit bureaus:

  • Attempting to collect a debt resulting from a charge that exceeds the amount allowed by law without surprises would violate the FDCPA’s prohibition against misrepresenting the character, amount, or legal status of any debt. In addition, debt collectors are also prohibited from using unfair or unreasonable means to collect or attempt to collect any debt, including the collection of any amount, unless such amount is expressly authorized by the agreement creating the debt. or authorized by law. Courts have pointed out that collecting an amount that exceeds what is owed would violate the prohibition against unfair or impermissible debt collection practices.
  • Many debt collectors provide information about unpaid medical debt to credit bureaus. Suppliers must have reasonable written policies and procedures regarding the accuracy and integrity of consumer information provided to credit bureaus. Credit reporting agencies that prepare a consumer report must follow reasonable procedures to ensure the greatest possible accuracy of the information contained in the consumer report. Credit bureaus and vendors must conduct reasonable and timely investigations of consumer disputes to verify the accuracy of consumer information.
  • For vendors and credit bureaus, the accuracy and dispute obligations imposed by the federal Consumer Financial Protection Act apply with respect to debts resulting from charges that exceed the amount permitted by law without surprises. .

The No Surprises Act is here on page 1577.


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