Protecting Veterans Credit Act of 2016

Summary: Protecting Veterans Credit Act of 2016 This bill amends the Fair Credit Reporting Act to exclude from a consumer report: (1) for one year, information related to a veteran's medical debt resulting from hospital or medical services provided in a non-Department of Veterans Affairs (VA) facility; and (2) information related to a fully paid or settled medical debt that had been characterized as delinquent, charged off, or in collection.   A veteran may submit a notice along with proof of VA liability for such debt to a consumer reporting agency or a reseller to dispute the debt's inclusion in a consumer report. The consumer reporting agency shall, within 30 days, delete such information from the consumer's file and notify the furnisher and the veteran.  The Consumer Credit Protection Act is amended to provide a mechanism for veterans to dispute the inclusion of program debt already on a credit report. A consumer reporting agency shall, within 30 days after receiving notice of such dispute, delete such information from the veteran's file and notify the furnisher and the veteran.   Within five days after the initial communication with a veteran, a debt collector shall, unless the appropriate information is contained in the initial communication or the veteran has paid the debt, send the veteran a written notice containing specified debt-related information, including information concerning the debt amount, creditors, the insurance company involved, and the hospital or medical care provider. If a veteran notifies the debt collector within such one-year period that the program debt is disputed or that the veteran requests the name and address of the original creditor, the debt collector shall cease collection until debt verification or the name and address of the original creditor is obtained.

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Protecting Veterans Credit Act of 
2016''.

SEC. 2. PURPOSE.

    The purposes of this Act are--
            (1) to rectify reporting of medical debt included in a 
        consumer report of a veteran due to inappropriate or delayed 
        payment for hospital care or medical services provided in a 
        non-Department of Veterans Affairs facility under the laws 
        administered by the Secretary of Veterans Affairs; and
            (2) to clarify the process of debt collection for such 
        medical debt.

SEC. 3. AMENDMENTS TO FAIR CREDIT REPORTING ACT.

    (a) Veteran's Medical Debt Defined.--Section 603 of the Fair Credit 
Reporting Act (15 U.S.C. 1681a) is amended by adding at the end the 
following:
    ``(z) Veteran.--The term `veteran' has the meaning given the term 
in section 101 of title 38, United States Code.
    ``(aa) Veteran's Medical Debt.--The term `veteran's medical debt' 
means a debt of a veteran arising from hospital care or medical 
services, as those terms are defined in section 1701 of title 38, 
United States Code, provided in a non-Department of Veterans Affairs 
facility under the laws administered by the Secretary of Veterans 
Affairs, including under section 1703, 1712, 1712A, 1725, or 1728 of 
title 38, United States Code.''.
    (b) Exclusion for Veteran's Medical Debt.--Section 605(a) of the 
Fair Credit Reporting Act (15 U.S.C. 1681c) is amended by adding at the 
end the following:
            ``(7) Any information related to a veteran's medical debt 
        if the date on which the debt was placed for collection, 
        charged to profit or loss, or subjected to any similar action 
        antedates the report by less than 1 year.
            ``(8) Any information related to a fully paid or settled 
        veteran's medical debt that had been characterized as 
        delinquent, charged off, or in collection.''.
    (c) Removal of Veteran's Medical Debt From Consumer Report.--
Section 611 of the Fair Credit Reporting Act (15 U.S.C. 1681i) is 
amended--
            (1) in subsection (a)(1)(A), by inserting ``and except as 
        provided in subsection (g)'' after ``subsection (f)''; and
            (2) by adding at the end the following:
    ``(g) Dispute Process for Veteran's Medical Debt.--
            ``(1) In general.--With respect to a veteran's medical debt 
        of a consumer, the consumer may submit a notice along with 
        proof of liability of the Department of Veterans Affairs for 
        payment of that debt to a consumer reporting agency or a 
        reseller to dispute the inclusion of that debt on a consumer 
        report of the consumer.
            ``(2) Deletion of information from file.--Not later than 30 
        days after the date on which a notice is received under 
        paragraph (1), the consumer reporting agency shall delete 
        information relating to the veteran's medical debt from the 
        file of the consumer and notify the furnisher and the consumer 
        of that deletion.''.

SEC. 4. COMMUNICATIONS REGARDING VETERAN'S MEDICAL DEBT.

    (a) In General.--Section 809 of the Fair Debt Collection Practices 
Act (15 U.S.C. 1692g) is amended--
            (1) in subsection (a), in the matter preceding paragraph 
        (1), by inserting ``, except for a veteran's medical debt as 
        described in subsection (f),'' after ``any debt''; and
            (2) by adding at the end the following:
    ``(f) Veteran's Medical Debt.--
            ``(1) Definitions.--In this subsection--
                    ``(A) the term `consumer reporting agency' has the 
                meaning given the term in section 603 of the Fair 
                Credit Reporting Act (15 U.S.C. 1681a);
                    ``(B) the term `veteran' has the meaning given the 
                term in section 101 of title 38, United States Code; 
                and
                    ``(C) the term `veteran's medical debt' means a 
                debt of a veteran arising from hospital care or medical 
                services, as those terms are defined in section 1701 of 
                title 38, United States Code, provided in a non-
                Department of Veterans Affairs facility under the laws 
                administered by the Secretary of Veterans Affairs, 
                including under section 1703, 1712, 1712A, 1725, or 
                1728 of title 38, United States Code.
            ``(2) Communications regarding veteran's medical debt.--Not 
        later than 5 days after the initial communication with a 
        veteran in connection with the collection of a veteran's 
        medical debt, a debt collector shall, unless the following 
        information is contained in the initial communication or the 
        veteran has paid the debt, send the veteran a written notice 
        containing--
                    ``(A) the amount of the debt;
                    ``(B) the name of the creditor to whom the debt is 
                owed;
                    ``(C) a statement that unless the veteran, within 1 
                year after receipt of the notice, disputes the validity 
                of the debt, or any portion thereof, the debt will be 
                assumed to be valid by the debt collector;
                    ``(D) a statement that if the veteran notifies the 
                debt collector in writing within the 1-year period that 
                the debt, or any portion thereof, is disputed, the debt 
                collector will obtain verification of the debt or a 
                copy of a judgment against the veteran and a copy of 
                such verification or judgment will be mailed to the 
                veteran by the debt collector;
                    ``(E) a statement that, upon the veteran's written 
                request within the 1-year period, the debt collector 
                will provide the veteran with the name and address of 
                the original creditor, if different from the current 
                creditor;
                    ``(F) a statement that the debt collector will not 
                report the debt to a consumer reporting agency until 1 
                year after the date on which the debt collector sends 
                the statement; and
                    ``(G) a statement that the consumer may communicate 
                with--
                            ``(i) an insurance company to determine 
                        coverage for the debt;
                            ``(ii) the Department of Veterans Affairs 
                        to determine coverage for the debt or repayment 
                        options; or
                            ``(iii) the provider of the hospital care 
                        or medical services from which the debt arises.
            ``(3) Collection of veteran's medical debt.--If the veteran 
        notifies the debt collector in writing within the 1-year period 
        described in paragraph (2)(D) that the veteran's medical debt, 
        or any portion thereof, is disputed, or that the veteran 
        requests the name and address of the original creditor, the 
        debt collector shall cease collection of the veteran's medical 
        debt, or any disputed portion thereof, until the debt collector 
        obtains verification of the veteran's medical debt or a copy of 
        a judgment, or the name and address of the original creditor, 
        and a copy of such verification or judgment, or name and 
        address of the original creditor, is mailed to the veteran by 
        the debt collector. Collection activities and communications 
        that do not otherwise violate this title may continue during 
        the 1-year period referred to in paragraph (2)(D) unless the 
        veteran has notified the debt collector in writing that the 
        veteran's medical debt, or any portion of the debt, is disputed 
        or that the veteran requests the name and address of the 
        original creditor. Any collection activities and communication 
        during the 1-year period may not overshadow or be inconsistent 
        with the disclosure of the veteran's right to dispute the 
        veteran's medical debt or request the name and address of the 
        original creditor.''.

SEC. 5. EFFECTIVE DATE.

    The amendments made by this Act shall take effect on the date that 
is 90 days after the date of enactment of this Act.