Trump Administration Seeks to Return Medical Debt to Credit Reports

In a move that could significantly impact millions of Americans, the Trump administration is taking steps to allow medical debt to reappear on credit reports. A federal rule implemented in 2014 had restricted the inclusion of such debt, but the Consumer Financial Protection Bureau (CFPB) is now seeking to overturn state restrictions and make it easier for medical debt to be reported.The 2014 rule had prohibited the inclusion of medical debt on credit reports if the debt was not paid within 180 days. This restriction was put in place to prevent consumers from being unfairly penalized for medical bills that they may not have been able to pay due to circumstances beyond their control. However, the CFPB has now proposed changes to this rule, which would allow medical debt to be reported on credit scores even if it is still being disputed or paid off.The proposed changes are seen as a win for debt collectors and credit reporting agencies, who have long argued that medical debt is a legitimate indicator of a consumer's creditworthiness. However, consumer advocates are sounding the alarm, warning that the move could have devastating consequences for Americans who are already struggling to pay their medical bills."It's a huge step backward for consumers," said Christine Reilly, a senior vice president at the National Foundation for Credit Counseling. "Medical debt can be a huge burden for people, and including it on credit reports can make it even harder for them to get back on their feet."The CFPB's proposal has sparked a heated debate, with some arguing that it will help lenders make more informed decisions about extending credit to consumers. However, others argue that it will disproportionately affect low-income and minority communities, who are already more likely to experience medical debt.The proposal is also seen as part of a broader effort by the Trump administration to roll back consumer protections and give more latitude to lenders and debt collectors. As the CFPB continues to consider comments on the proposal, consumer advocates are urging Americans to speak out against the changes."This is a critical issue that affects millions of Americans," said Reilly. "We need to make sure that consumers are protected and that their credit reports accurately reflect their financial situation."