ACA comments on bureau overreach and impact on providers and patients.
06/11/2024 2:35 P.M.
2 minute read
June 11, 2024 – Washington, D.C. – ACA International (“ACA”) has responded to the Consumer Financial Protection Bureau’s (“CFPB”) Notice of Proposed Rulemaking (“NPRM”), which focuses on the Fair Credit Reporting Act and medical debt, with the following statement from CEO Scott Purcell:
“The CFPB’s proposal will have a broad negative impact on businesses, health care providers, patients and consumers because by suppressing information about a consumer’s debt, this will increase the cost of medical care and force more upfront payments.
The rule, if finalized, would fundamentally alter the U.S. credit-based economy as it is today in terms of reduced consequences for not paying your bills, which in turn will reduce access to credit and health care for those that need it most.”
Leah Dempsey, shareholder at Brownstein Hyatt Farber Schreck LLP, also weighed in on the CFPB’s actions.
“In its proposal, the CFPB attempts to rewrite the Fair Credit Reporting Act, which is an impermissible overreach since lawmaking is the job of Congress,” Dempsey said. “The bureau is also blatantly ignoring, in an arbitrary and capricious way, an abundance of evidence provided to it by a variety of financial service providers that medical debt is predictive and needed information for lenders to understand a consumer’s ability to repay.”
Dr. Andrew Nigrinis, Ph.D., who formerly worked as an enforcement economist at the CFPB, shared his thoughts on the proposed rule.
“From a provider perspective, the CFPB is irresponsibly proposing to regulate a significant portion of the health care industry’s revenue without a meaningful analysis of the effects on consumers, industry, health practitioners and patients,” Nigrinis said. “It is a basic tenet of economics that one person’s debt represents another person’s income. This will affect the income of medical providers, and the CFPB has not bothered to quantify this real cost. From a credit granting perspective, the CFPB, by reducing the information value of credit reports and removing predictive medical debt tradelines, is contradicting its policy to require lenders to conduct an Ability to Repay analysis. Essentially, this rule is an information tax on responsible borrowers.”
ACA International (ACA), the association of credit and collection professionals, is the largest membership organization in the credit and collection industry. Founded in 1939, ACA brings together third-party collection agencies, law firms, asset buying companies, creditors and vendor affiliates, representing tens of thousands of industry professionals. ACA produces a wide variety of products, services and publications, including educational and compliance-related information; and articulates the value of the credit and collection industry to businesses, policymakers and consumers. www.acainternational.org.
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