CFPB Medical Debt Removal

The CFPB’s recent rule to remove medical debt from credit scores and its rhetoric labeling patient financial advocates as “predators” reflect a misunderstanding of the healthcare system and the critical role these advocates play in supporting patients. By vilifying those who help patients navigate financial challenges, the CFPB risks creating fear and support for a rule that does more harm than good.

1. Mischaracterizing Patient Financial Advocates

The CFPB’s portrayal of patient financial advocates as predators preying on vulnerable individuals is not only misleading but also damaging. Patient advocates work tirelessly to help patients access coverage they may not know they qualify for, resolve billing disputes, and find ways to manage their medical expenses. By labeling these professionals as harmful, the CFPB disregards the essential role they play in ensuring patients receive the care they need without undue financial stress.

Example: A patient financial advocate at a hospital might help an uninsured patient enroll in Medicaid or identify charity care programs. The CFPB’s narrative unfairly suggests these advocates are exploiting patients, when in reality, they are often the key to patients receiving life-saving care without incurring overwhelming debt.

2. Fearmongering to Justify Harmful Policy

The CFPB’s language is clearly designed to instill fear and garner public support for its rule. However, this approach distracts from the rule’s potential to harm the healthcare system and patients alike. By framing patient financial advocates as villains, the CFPB deflects attention from the unintended consequences of removing medical debt from credit reports, such as reduced access to care and higher costs for all.

Example: A hospital’s financial counselor helps a patient set up an affordable payment plan after surgery. Under the CFPB’s framing, this advocate could be viewed as a predator rather than a lifeline, creating unnecessary distrust between patients and the professionals who aim to assist them.

3. A Lack of Understanding of the Healthcare System

The CFPB’s stance demonstrates a fundamental misunderstanding of how the healthcare system works, particularly the complex financial challenges patients face. Rather than working collaboratively to address issues like underinsurance or high out-of-pocket costs, the CFPB has chosen to vilify those who help patients navigate these challenges.

Example: A low-income patient facing a $10,000 hospital bill might not know they qualify for financial assistance. Patient advocates step in to guide them through the process, but the CFPB’s narrative undermines trust in these advocates, leaving patients to fend for themselves.

4. Unintended Consequences of the Rule

By removing medical debt from credit scores, the CFPB inadvertently harms the very patients it claims to protect. Without credit implications, patients may deprioritize medical bills, leading to financial strain for providers and increased costs for everyone. This could also reduce access to care, particularly for underserved communities relying on financially fragile healthcare facilities.

Example: A rural hospital that cannot collect payments because of diminished accountability may be forced to cut back on services or close altogether, leaving patients without local care options.

5. Undermining Efforts to Address Root Causes

Instead of addressing the root causes of medical debt—such as high healthcare costs and gaps in insurance—the CFPB’s rule shifts focus to punishing healthcare providers and advocates. This shortsighted approach fails to provide sustainable solutions and risks exacerbating financial challenges across the system.

Example: Advocacy efforts to expand coverage options and reduce costs may lose momentum if the public perceives the CFPB’s rule as a solution, further delaying meaningful reform.

Conclusion

The CFPB’s rule and its characterization of patient financial advocates as predators represent a fundamental misunderstanding of the healthcare system and those working to help patients. By creating fear and mistrust, the CFPB undermines the important role advocates play in helping patients access care and manage their financial responsibilities. Rather than vilifying these professionals, the CFPB should work collaboratively with stakeholders to address the systemic issues that drive medical debt, such as affordability and coverage gaps. This approach would provide real solutions without harming the healthcare system or the patients it serves.