US watchdog issues warning to medical debt collectors
2024.10.01 15:24
(Reuters) – The top U.S. consumer financial watchdog on Tuesday warned medical debt collectors they face enforcement action by federal regulators if they illegally attempt to collect on inaccurate or legally invalid medical debts.
Around 100 million Americans currently owe $220 billion in medical debt, according to the U.S. Consumer Financial Protection Bureau, which issued legal guidance on what it said were illegal debt collection tactics.
THE TAKE
The CFPB, the federal agency that industry loves to hate, is making its latest move to clamp down on revenue-generating practices it says are predatory.
With a large segment of the electorate angered by rising prices in a tight election year, Vice President Kamala Harris has also spearheaded the CFPB’s efforts to remove medical debt from consumer credit reports.
KEY QUOTE
“Medical billing is often riddled with errors, including inflated or duplicative charges, fees for services the patient never received, or charges already paid,” CFPB Director Rohit Chopra said in a statement. “The CFPB is taking action to ensure that Americans are not unfairly chased by debt collectors over unsubstantiated or invalid medical bills.”
CONTEXT
According to the CFPB, illegal practices include double billing for the same service, collecting on debts that are false or insufficiently documented or that exceed legal caps, and misrepresenting consumers’ right to dispute charges.
