News & Impact Stories

Congress Wants Medical Debt on Credit Reports To Keep Hurting Americans

March 12, 2025 — Press Release

Broad Coalition Opposes Bill to Block CFPB Rule that Would Remove Medical Debt From Credit Reports, Pushing Borrowing Costs Higher for Working Families

WASHINGTON – Today, U.S. Senator Mike Rounds (R-SD) and Representative Ralph Norman (R-SC) introduced bills to overturn a rule that will remove medical debt from credit reports. 277 organizations sent a letter to Congress in support of the Consumer Financial Protection Bureau (CFPB) rule that seeks to end the devastating impact of medical debt on consumers’ credit scores by stopping credit reporting companies from sharing medical debts with lenders and prohibiting lenders from making lending decisions based on existing medical debt. 

“Senator Rounds and Representative Norman’s bill would yank away an important protection from 15 million hardworking Americans and allow medical debt to keep damaging their credit scores,” said Chi Chi Wu, senior attorney at the National Consumer Law Center. “Being sick and having medical bills has little to do with whether people will pay their loan payments, but these members of Congress callously think it’s their job to allow medical debts to shut these folks out from access to credit or make credit more expensive for families struggling to make ends meet.” 

The resolutions, S.J. Res.36 and H.J. Res.74, were introduced under the Congressional Review Act (CRA). The CRA allows Congress, with the President’s signature, to overturn rules using expedited procedures. If Congress and President Trump overturn the rule, it would allow vast amounts of medical debt information – including inaccurate and disputed bills – to remain in the credit reporting system where it harms the credit scores of millions.

“No one chooses to get sick or injured,” said Mona Shah, senior director of policy and strategy at Community Catalyst. “Medical debt should not prevent people from getting a loan for a car, a house, or starting a new business. We urge members of Congress to vote against keeping medical debt on credit scores and to focus instead on addressing the root causes of the medical debt crisis.” 

Equifax, Transunion, and Experian voluntarily removed some medical collections information starting in 2022, but in 2024 the CFPB found that 15 million Americans still had more than $49 billion in outstanding medical debt on their credit reports. Consumers burdened by medical debt on their credit reports are more likely to live in the South and in predominantly Black and Latino/Hispanic neighborhoods. People with disabilities are twice as likely to have past due medical bills as others. And veterans and servicemembers have as much as $6 billion in medical debt.

Medical debt on credit reports limits peoples’ ability to obtain affordable credit and it assists debt collectors in seeking to coerce payments, including for inaccurate or false medical bills.

Additional Quotes 

“Someone’s history of unexpected medical debt has no correlation with their willingness or ability to repay future bills, so it should have no bearing on a person’s access to credit, an apartment or a job,” said Ruth Susswein, Consumer Action’s Director of Consumer Protection.

“Allowing medical debt to reside on credit reports gives insurance companies more power to bully vulnerable people,” said Adam Rust, director of financial services at the Consumer Federation of America. “When health care gets mixed up with personal finances, it causes senseless heartache. Many people pay debts they do not owe and others forego needed care, just to protect their credit scores. People struggle under the burden of medical debt in every state and district, but it is especially true for people living in the rural South and those with long-term illnesses.” 

“Credit-damaging medical debt can shut off access to affordable loans and other financial opportunities, like getting a job or renting an apartment,” said Chuck Bell, advocacy program director at Consumer Reports. “That’s especially unfair since many consumers have medical bills on their credit reports that are inaccurate or under dispute. Congress should reject this misguided attempt to repeal the CFPB’s rule since it’s been shown that medical debt is not a reliable predictor of credit risk.”

“There is a biblical principle in the Christian tradition of caring for the sick. The extraction of wealth that is caused by those who add insult to injury with their predatory practices concerning medical debt is the antithesis of this care,” said Rev. Cassandra Gould at the Faith in Action National Network. “Being sick isn’t a sin or a crime and people shouldn’t be punished for it.” 

“Survivors of domestic violence are saddled with medical debt, resulting directly from the abuse they suffered at the hands of their partner. When creditors unjustly report medical debt on credit reports, it compounds the economic and physical harms survivors have already experienced and exposes survivors to increased risk of future violence. We cannot allow that systemic barrier to stand,” said Erika Sussma, executive director at the Center for Survivor Agency and Justice. “The CFPB’s medical debt rule is critical to survivors’ access to healing and safety.”

“Nobody plans to get sick or hurt, and a nasty surprise like medical debt shouldn’t be a deciding factor in their financial future. The CFPB is stepping up to make sure a medical emergency or billing mistake doesn’t get in the way of people buying a home, car, or obtaining a small business loan,” said Tony Carrk, executive director of Accountable.US.

“NALCAB – the National Association for Latino Community Asset Builders applauds the Consumer Financial Protection Bureau (CFPB)’s final rule banning medical debt from credit reports. According to a report by the Urban Institute, adults who live in communities where the majority of the population are people of color are more likely to have medical debt in collections reported on their credit reports. Today’s announcement will help boost the economic trajectory of Latinos and therefore further stimulate economic growth,” said Clarinda Landeros, director of public policy, NALCAB. 

Alaska

“It surprises Alaskans when health insurance fails to protect them from the extremely high costs of healthcare in our state,” said Claire Lubke, Economic Justice Lead at Alaska Public Interest Research Group (AKPIRG). “Medical debt doesn’t only affect the 13.5% of Alaskans that are uninsured. It can impact anybody, including military members and those with access to Tribal health services. All it takes is an accidental visit to an out-of-network provider, a denied claim, or a tangle of bureaucracy.”

Arizona

“Arizonans overwhelmingly support reforms to medical debt as evidenced by the overwhelming passage of Prop 209,” said Kelly Griffith, executive director of the Center for Economic Integrity.

Colorado

“Colorado moved to ban credit reporting of all medical debt in 2023, and the CFPB’s decision to extend these protections to all Americans was a major win for patients and families across the country. The cynical efforts to shut down the CFPB and all of its hard-fought protections will result in catastrophic setbacks for Americans seeking housing, insurance or even new employment,” said Lydia McCoy, CEO, Colorado Center on Law and Policy.

“We’ve seen in Colorado that prohibiting reporting of medical debt doesn’t cause the sky to fall–it’s a basic and commonsense protection that benefits everyone,” said David Seligman, executive director of Towards Justice.

Florida

“Medical debt is the wild west and there is no way it should appear on anyone’s credit,” said Sami Thalji at Florida Consumer Lawyers.

Michigan

“Ill health is the fastest route from the middle class into poverty in America. Medical debt often reflects fragmentation and predation in the health care sector. Allowing medical debt to destroy credit ratings endangers employment, housing, and everything else needed to build a stable life in America,” said Prof. Scott L. Greer, University of Michigan-Ann Arbor (Organization listed for identification only)

Missouri

“No one should go into debt or have their credit ruined because they need lifesaving care,” said Reverend Susan Schmalzbauer, Missouri Faith Voices. 

New Jersey

“Medical debt shouldn’t be used to determine someone’s creditworthiness,” said Joseph Sullivan, executive director at the Manufactured Home Owners Association of New Jersey. “MHOA-NJ represents all manufactured housing residents in New Jersey and has heard the horror stories of those denied acceptance in a manufactured housing community because they suffered a severe medical event in their lives that put them in debt to our medical system. These are some of the most vulnerable people denied a safe and affordable place to live because medical debt destroyed their credit rating.”

“Some states, including New Jersey, have enacted important legislation banning the reporting of most medical debt, which is a significant step toward reducing the severe economic harms caused by medical debt. However, to ensure the strongest and most sustainable financial protections, our residents need a comprehensive approach that combines state and federal reforms. The CFPB’s rule provides that critical federal safeguard,” said Beverly Brown Ruggia, financial justice organizer at New Jersey Citizen Action. “We call on the New Jersey Congressional delegation and all members of Congress to stand with the public and defend the rule from attacks and roll backs.”

New Mexico

“United South Broadway Corporation serves thousands of low-income homeowners in New Mexico who are especially vulnerable to unexpected medical expenses that could block their access to credit. Most low-income New Mexicans (57%) own their homes; many families have owned their homes for generations,” said Deborah Norman, program manager at the United South Broadway Corporation. “This rule would help protect families and stabilize neighborhoods.” 

New York

“Medical debt on credit reports is harmful to everyone. A good credit score should be protected. Medical debt is not something people seek. They are already being impacted by a medical event that might interrupt their income. We should not add to that already difficult situation,” said Melissa Marquez, CEO at the Genesee Co-op Federal Credit Union.

North Carolina

“Medical debt is crushing families and individuals who are trying to survive with debts mostly that are impossible to get paid off especially when you are sick and disabled. These debts cripple families and individuals and make them homeless and need to be regulated,” said Lois M. Healy, CEO of the Affordable Homeownership Foundation, Inc. 

North Dakota

“As a non-profit aimed at helping homeless veterans and low income individuals gain housing, medical debt continuously serves as a barrier to finding safe and affordable homes due to their impact on credit scores,” said Jacqueline Hassett, LMSW, executive director at Red River Valley Community Action. “Nobody should be homeless because of medical debt beyond their control.” 

South Carolina

“A person should not be punished over and over through a credit report because they couldn’t afford to pay for having a heart attack,” said Ma’ta Crawford, community navigator at Community Fresh Start.

“Hardworking families in South Carolina are already struggling with financial challenges like medical debt—removing these protections would only make things worse,” said Tanya Rodriguez-Hodges, executive director of Latino Community Development.

Texas

“Medicine in the United States has become a business and not a compassionate profession. 40% of the population in the Rio Grande Valley of Texas are working yet uninsured,” said Jose Hinojosa of ValleyInterfaith. “In this country of abundance, why is it the working poor who suffer the most?”

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