It said affected individuals’ credit scores would improve by an average of 20 points and lead to the approval of approximately 22,000 additional mortgages every year.

The Biden administration is moving to ban medical debt from credit reports.

Vice President Kamala Harris said Tuesday that the proposed rule, taken through the Consumer Financial Protection Bureau, would reduce the number of Americans with medical debt listed on their credit reports to zero, down from 46 million in 2020.

In a press call Tuesday, Harris said the move would help improve the financial health and wellbeing of millions of Americans.

Medical debt, she said, “makes it more difficult to get by, much less get ahead. That is simply not fair.”

The administration calculates that if implemented, the rule would raise affected individuals’ credit scores by an average of 20 points, and could lead to the approval of approximately 22,000 additional mortgages every year as a result of the cleaned-up credit reports.

A recent study estimated that one in five U.S. households live with medical debt, including people with health insurance; and that on average, a typical American household owes about $4,600 in medical debts.

  • MutilationWave@lemmy.world
    3·
    5 months ago

    I had heard that medical debt cannot effect your credit. Believe me it can. I had to have a malignant melanoma removed from my back. I put it off until it nearly killed me (quite literally, they told me it was 2mm from my bloodstream and would have killed me if it got there) so I could afford insurance before I got it looked at. I received two bills. My wife was in school and I was making 34k a year for both of us to live on.

    For one bill they let me pay $50 a month. The other bill they wouldn’t accept anything less than $200 a month which was completely undoable for me. I told them they could get $50 a month from me or never see a penny. Two months later it was sold to a collection agency and immediately knocked my credit down by about 150 points. It went back up by that amount seven years later. They never got a cent.