Consumer Protection for Medical Debt Collections Act
Bill: H.R.2537 | Sponsor: Rep. Tlaib, Rashida (D-MI)
Policy area: Finance and Financial Sector

Summary:
Consumer Protection for Medical Debt Collections Act
This bill restricts the inclusion of medical debt on a consumer credit report.
A consumer reporting agency is prohibited from including on a consumer credit report, and a person is prohibited from reporting to such agency (1) medical debt arising from a medically necessary procedure, or (2) other medical debt less than a year old.
A person reporting medical debt to a consumer reporting agency must first provide notice to that consumer regarding the restrictions on including medical debt on credit reports.
Furthermore, a debt collector is prohibited from collecting a medical debt less than two years old.

To amend the Fair Debt Collection Practices Act to provide a timetable 
  for the collection of medical debt by debt collectors, to amend the 
Fair Credit Reporting Act to prohibit consumer reporting agencies from 
issuing consumer reports containing information about debts related to 
        medically necessary procedures, and for other purposes.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Consumer Protection for Medical Debt 
Collections Act''.

SEC. 2. AMENDMENTS TO THE FAIR DEBT COLLECTION PRACTICES ACT.

    (a) Definition.--Section 803 of the Fair Debt Collection Practices 
Act (15 U.S.C. 1692a) is amended by adding at the end the following:
                    ``(9) The term `medical debt' means a debt arising 
                from the receipt of medical services, products, or 
                devices.''.
    (b) Unfair Practices.--Section 808 of the Fair Debt Collection 
Practices Act (15 U.S.C. 1692f) is amended by adding at the end the 
following:
                    ``(9) Engaging in activities to collect or 
                attempting to collect a medical debt owed or due or 
                asserted to be owed or due by a consumer, before the 
                end of the 2-year period beginning on the date that the 
                first payment with respect to such medical debt is 
                due.''.

SEC. 3. PROHIBITION ON CONSUMER REPORTING AGENCIES REPORTING CERTAIN 
              MEDICAL DEBT.

    (a) Definition.--Section 603 of the Fair Credit Reporting Act (15 
U.S.C. 1681a) is amended by adding at the end the following:
    ``(bb) Medical Debt.--The term `medical debt' means a debt arising 
from the receipt of medical services, products, or devices.
    ``(cc) Medically Necessary Procedure.--The term `medically 
necessary procedure' means--
            ``(1) health care services or supplies needed to diagnose 
        or treat an illness, injury, condition, disease, or its 
        symptoms and that meet accepted standards of medicine; and
            ``(2) health care to prevent illness or detect illness at 
        an early stage, when treatment is likely to work best 
        (including preventive services such as pap tests, flu shots, 
        and screening mammograms).''.
    (b) In General.--Section 605(a) of the Fair Credit Reporting Act 
(15 U.S.C. 1681c(a)) is amended by adding at the end the following new 
paragraphs:
            ``(9) Any information related to a debt arising from a 
        medically necessary procedure.
            ``(10) Any information related to a medical debt, if the 
        date on which such debt was placed for collection, charged to 
        profit or loss, or subjected to any similar action antedates 
        the report by less than 365 calendar days.''.

SEC. 4. REQUIREMENTS FOR FURNISHERS OF MEDICAL DEBT INFORMATION.

    (a) Additional Notice Requirements for Medical Debt.--Section 623 
of the Fair Credit Reporting Act (15 U.S.C. 1681s-2) is amended by 
adding at the end the following:
    ``(f) Additional Notice Requirements for Medical Debt.--Before 
furnishing information regarding a medical debt of a consumer to a 
consumer reporting agency, the person furnishing the information shall 
send a statement to the consumer that includes the following:
            ``(1) A notification that the medical debt--
                    ``(A) may not be included on a consumer report made 
                by a consumer reporting agency until the later of the 
                date that is 365 days after--
                            ``(i) the date on which the person sends 
                        the statement;
                            ``(ii) with respect to the medical debt of 
                        a borrower demonstrating hardship, a date 
                        determined by the Director of the Bureau; or
                            ``(iii) the date described under section 
                        605(a)(10); and
                    ``(B) may not ever be included on a consumer report 
                made by a consumer reporting agency, if the medical 
                debt arises from a medically necessary procedure.
            ``(2) A notification that, if the debt is settled or paid 
        by the consumer or an insurance company before the end of the 
        period described under paragraph (1)(A), the debt may not be 
        reported to a consumer reporting agency.
            ``(3) A notification that the consumer may--
                    ``(A) communicate with an insurance company to 
                determine coverage for the debt; or
                    ``(B) apply for financial assistance.''.
    (b) Furnishing of Medical Debt Information.--Section 623 of the 
Fair Credit Reporting Act (15 U.S.C. 1681s-2), as amended by subsection 
(a), is further amended by adding at the end the following:
    ``(g) Furnishing of Medical Debt Information.--
            ``(1) Prohibition on reporting debt related to medically 
        necessary procedures.--No person shall furnish any information 
        to a consumer reporting agency regarding a debt arising from a 
        medically necessary procedure.
            ``(2) Treatment of other medical debt information.--With 
        respect to a medical debt not described under paragraph (1), no 
        person shall furnish any information to a consumer reporting 
        agency regarding such debt before the end of the 365-day period 
        beginning on the later of--
                    ``(A) the date on which the person sends the 
                statement described under subsection (f) to the 
                consumer;
                    ``(B) with respect to the medical debt of a 
                borrower demonstrating hardship, a date determined by 
                the Director of the Bureau; or
                    ``(C) the date described in section 605(a)(10).
            ``(3) Treatment of settled or paid medical debt.--With 
        respect to a medical debt not described under paragraph (1), no 
        person shall furnish any information to a consumer reporting 
        agency regarding such debt if the debt is settled or paid by 
        the consumer or an insurance company before the end of the 365-
        day period described under paragraph (2).
            ``(4) Borrower demonstrating hardship defined.--In this 
        subsection, and with respect to a medical debt, the term 
        `borrower demonstrating hardship' means a borrower or a class 
        of borrowers who, as determined by the Director of the Bureau, 
        is facing or has experienced unusual extenuating life 
        circumstances or events that result in severe financial or 
        personal barriers such that the borrower or class of borrowers 
        does not have the capacity to repay the medical debt.''.

SEC. 5. EFFECTIVE DATE.

    This Act and the amendments made by this Act shall take effect on 
the date that is 180 days after the date of enactment of this Act.
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