Americans often “forced” to pay medical bills they don’t owe, feds say

It is not surprising that many Americans are harassed by medical bills, especially as the COVID-19[feminine] the pandemic continues. Perhaps more telling is that this is often a debt that you have already paid or that you do not actually owe.

In a new report, the Office of Consumer Financial Protection said people’s most frequent debt collection complaints last year had to do with efforts to collect a bill that they said did not belong to them.

“In medical debt collection complaints, this problem accounts for nearly half of all complaints, and importantly, the volume of complaints on this issue has been increasing,” the federal agency said. Bills often end up on people’s credit reports and force them to a bureaucratic hamster wheel to clear their financial history.

Between 2018 and 2021, public complaints about attempts to collect medical bills that consumers said they did not say increased by 31%, the CFPB found. According to federal data, approximately 1 in 5 households in the United States has debt related to health care. According to regulators, medical bills are the most frequently reported item in consumer credit reports.

“People also report having a pending medical bill only after experiencing a drop in their credit score and being told that just paying the bill would remove negative billing information from their credit report.” added the CFPB. “When they received prior notice of medical bills in the collections, people reported that debt collectors included detailed medical information that led to violations of the privacy of sensitive medical information.”

750,000 complaints

Last year, the CFPB said it sent more than 750,000 complaints to approximately 3,400 companies for review. Other agency findings include:

• The average medical debt in the US is $ 310.
• In 2021, 15% of debt collection complaints were about attempts to collect a medical debt.
• Consumers who receive notices of a medical bill often report that they do not know the provider.
• Consumers also report that collection notices often contain large amounts of personal medical information.
• Many Americans say they pay medical bills to avoid adverse financial consequences and privacy, even if they consider the debt to be invalid.
• Communities with more minority or low-income people, veterans, and young adults are more likely to have medical bills reported on their credit reports.

“Many Americans feel compelled to pay medical bills that they have already paid or never owed to begin with,” CFPB Director Rohit Chopra said in a statement. “The credit reporting system should not be used as a weapon to coerce patients into paying medical bills that they do not owe.”

In March, major credit rating firms Equifax, Experian and TransUnion said they planned to eliminate most of the medical debt from consumer credit reports starting this summer.

Congress last year tried to address the issue of track medical bills pass the “No Surprises Act” which protects people with health insurance from being charged for receiving out-of-network emergency medical care.

By law, patients are still responsible for the deductibles and copayments they would normally have to pay under their plan, but they can only be billed at the network rate of their plan.