The Biden administration, according to vice president Kamala Harris, is beginning to remove medical expenses from people’s credit scores, which could boost scores for millions of individuals.
According to Harris, doing so would make it simpler for them to get a home mortgage or an auto loan. One in five Americans say they have medical debt. The Consumer Financial Protection Bureau is starting the regulation process to implement the change, the vice president announced.
Medical debt inclusion in credit scores, according to the agency, is problematic because “mistakes and inaccuracies in medical billing are common.”
According to Harris, having access to healthcare should not be a privilege but rather a right. Millions of Americans’ credit scores will rise as a result of these actions, making it easier for them to make investments in the future.
The move follows a sustained effort by the Biden administration to downplay the significance of medical debt in determining a person’s creditworthiness. In March of last year, Equifax, TransUnion, and Experian declared they would stop publishing “some but not all medical bills on an individual’s credit report.” According to CFPB director Rohit Chopra.
The idea would bar medical bills from being taken off credit reports, creditors from considering medical costs when approving loans, and debt collectors from using credit ratings to put pressure on persons with medical debt. Following consultation with small firms, the government will issue a notice of a proposed rulemaking sometime in 2019.