Latest news with #creditreports
Yahoo
6 hours ago
- Business
- Yahoo
A judge blocked a rule to drop medical debt from credit reports. What now?
A recent federal court ruling overturned a Biden-era ban on medical debt in credit reports just as access to healthcare and health insurance is becoming more fragile. The decision could thwart the hopes of an estimated 15 million Americans who might have seen some relief ahead of expected hikes to healthcare premiums, the end of enhanced marketplace subsidies, and an anticipated increase in the number of Americans without insurance. 'We're really concerned that with the loss of insurance altogether, or healthcare becoming more expensive, we're just going to see more medical debt,' said Mona Shah, the senior director of policy and strategy at Community Catalyst, a national nonprofit healthcare advocacy organization. 'With this protection removed around credit reporting, it's going to impact people's overall economic well-being and ability to thrive.' A $49 billion reversal Earlier this month, a federal judge blocked a rule from the Consumer Financial Protection Bureau (CFPB), which had never taken effect, that would have stopped medical bills from appearing on credit reports and barred lenders from using such data to make lending decisions. The CFPB estimated the change could raise impacted consumers' credit scores by an average of 20 points. Healthcare providers typically don't report missed medical bills directly to credit bureaus, according to Equifax, so medical debt often doesn't wind up on a credit report until it's been reported to a collections agency. However, two trade associations successfully argued that the CFPB had overstepped its authority. Under the Trump administration, the CFPB also asked for the rule to be thrown out. In a July 11 ruling, Judge Sean Jordan of the US District Court for the Eastern District of Texas agreed with the trade groups. The ruling comes at an especially precarious time in healthcare. The tax bill signed into law by President Trump this month is expected to leave 10 million Americans without health insurance by 2034, largely due to changes in Medicaid. Meanwhile, enhanced premium tax credits that helped make Affordable Care Act marketplace coverage more affordable will expire at the end of this year after they were not extended in the tax bill, a change that will help contribute to the largest premium increases seen in years in 2026. The end of the subsidies is expected to leave an estimated 4.2 million people uninsured. 'Having more people lose Medicaid and become uninsured, and also lower-income adults losing subsidized marketplace coverage and becoming uninsured, is going to significantly increase medical debt,' said Fredric Blavin, a senior fellow and researcher at the Urban Institute, a Washington-based think tank. Under the Biden administration, the CFPB estimated that removing medical bill information could have wiped $49 billion off the credit reports of about 15 million Americans, noting that medical billing information often contained errors and was a poor predictor of a consumer's creditworthiness. Lower credit scores can damage a person's ability to rent a home, obtain a credit card with a favorable rate, and even impact their job search. In public comments supporting the rule, many Americans shared stories of how medical bills had weighed on their credit, including cancer patients, people who had been in car wrecks, and more. Read more: How are credit scores calculated? Sign up for the Mind Your Money weekly newsletter By subscribing, you are agreeing to Yahoo's Terms and Privacy Policy What should consumers do now? Credit reporting agencies had already voluntarily decided in April 2023 to wipe medical collection debt from consumer credit reports if the balance was below $500. A year earlier, paid medical collection debt was also dropped from credit reports, and consumers were given one year to pay down medical collection debt before it started appearing on their credit reports, rather than six months. Additionally, the CFPB noted that FICO and VantageScore had previously both 'decreased the degree to which medical bills impact a consumer's score.' These combined changes dropped medical debt in collections from most consumers' credit reports, the Urban Institute found, leaving about 4.1% of adults with such data on their records in August 2024, down from 12.6% in February 2022. Additionally, 14 states have provisions in place to remove medical collection debt from credit reports. 'We expect more states to take the same initiative moving forward,' said Breno Braga, a senior fellow and researcher at the Urban Institute. Still, consumers are left with the onerous job of keeping up with these changes and staying on top of their credit as they face mounting bills — along with the resumption of delinquent student loans hitting credit scores. Consumers should regularly check their mail and email for information concerning their credit, while also carefully examining the bills to determine what they owe and what they might be able to contest. When it comes to unaffordable medical care, consumers can ask healthcare providers about financial assistance options. Read more: How to check your credit score for free 'It's really just vigilance and trying to understand what's available in terms of assistance,' said Sarah Chenven, the CEO of Working Credit, a nonprofit organization that helps people build good credit. Consumers should also be cautious about signing up for medical credit cards with a 'deferred interest', said Shah with Community Catalyst, which may subject them to high, retroactive interest charges if they don't pay their bill in a certain promotional period. 'When patients are now faced with these difficult decisions of not being able to pay off these bills right away — worried about how it's going to impact their credit scores, losing their insurance, still needing healthcare — they may be lured into signing up for one of these payment products,' said Shah. Emma Ockerman is a reporter covering the economy and labor for Yahoo Finance. You can reach her at Sign up for the Mind Your Money newsletter Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
6 hours ago
- Business
- Yahoo
A judge blocked a rule to drop medical debt from credit reports. What now?
A recent federal court ruling overturned a Biden-era ban on medical debt in credit reports just as access to healthcare and health insurance is becoming more fragile. The decision could thwart the hopes of an estimated 15 million Americans who might have seen some relief ahead of expected hikes to healthcare premiums, the end of enhanced marketplace subsidies, and an anticipated increase in the number of Americans without insurance. 'We're really concerned that with the loss of insurance altogether, or healthcare becoming more expensive, we're just going to see more medical debt,' said Mona Shah, the senior director of policy and strategy at Community Catalyst, a national nonprofit healthcare advocacy organization. 'With this protection removed around credit reporting, it's going to impact people's overall economic well-being and ability to thrive.' A $49 billion reversal Earlier this month, a federal judge blocked a rule from the Consumer Financial Protection Bureau (CFPB), which had never taken effect, that would have stopped medical bills from appearing on credit reports and barred lenders from using such data to make lending decisions. The CFPB estimated the change could raise impacted consumers' credit scores by an average of 20 points. Healthcare providers typically don't report missed medical bills directly to credit bureaus, according to Equifax, so medical debt often doesn't wind up on a credit report until it's been reported to a collections agency. However, two trade associations successfully argued that the CFPB had overstepped its authority. Under the Trump administration, the CFPB also asked for the rule to be thrown out. In a July 11 ruling, Judge Sean Jordan of the US District Court for the Eastern District of Texas agreed with the trade groups. The ruling comes at an especially precarious time in healthcare. The tax bill signed into law by President Trump this month is expected to leave 10 million Americans without health insurance by 2034, largely due to changes in Medicaid. Meanwhile, enhanced premium tax credits that helped make Affordable Care Act marketplace coverage more affordable will expire at the end of this year after they were not extended in the tax bill, a change that will help contribute to the largest premium increases seen in years in 2026. The end of the subsidies is expected to leave an estimated 4.2 million people uninsured. 'Having more people lose Medicaid and become uninsured, and also lower-income adults losing subsidized marketplace coverage and becoming uninsured, is going to significantly increase medical debt,' said Fredric Blavin, a senior fellow and researcher at the Urban Institute, a Washington-based think tank. Under the Biden administration, the CFPB estimated that removing medical bill information could have wiped $49 billion off the credit reports of about 15 million Americans, noting that medical billing information often contained errors and was a poor predictor of a consumer's creditworthiness. Lower credit scores can damage a person's ability to rent a home, obtain a credit card with a favorable rate, and even impact their job search. In public comments supporting the rule, many Americans shared stories of how medical bills had weighed on their credit, including cancer patients, people who had been in car wrecks, and more. Read more: How are credit scores calculated? Sign up for the Mind Your Money weekly newsletter By subscribing, you are agreeing to Yahoo's Terms and Privacy Policy What should consumers do now? Credit reporting agencies had already voluntarily decided in April 2023 to wipe medical collection debt from consumer credit reports if the balance was below $500. A year earlier, paid medical collection debt was also dropped from credit reports, and consumers were given one year to pay down medical collection debt before it started appearing on their credit reports, rather than six months. Additionally, the CFPB noted that FICO and VantageScore had previously both 'decreased the degree to which medical bills impact a consumer's score.' These combined changes dropped medical debt in collections from most consumers' credit reports, the Urban Institute found, leaving about 4.1% of adults with such data on their records in August 2024, down from 12.6% in February 2022. Additionally, 14 states have provisions in place to remove medical collection debt from credit reports. 'We expect more states to take the same initiative moving forward,' said Breno Braga, a senior fellow and researcher at the Urban Institute. Still, consumers are left with the onerous job of keeping up with these changes and staying on top of their credit as they face mounting bills — along with the resumption of delinquent student loans hitting credit scores. Consumers should regularly check their mail and email for information concerning their credit, while also carefully examining the bills to determine what they owe and what they might be able to contest. When it comes to unaffordable medical care, consumers can ask healthcare providers about financial assistance options. Read more: How to check your credit score for free 'It's really just vigilance and trying to understand what's available in terms of assistance,' said Sarah Chenven, the CEO of Working Credit, a nonprofit organization that helps people build good credit. Consumers should also be cautious about signing up for medical credit cards with a 'deferred interest', said Shah with Community Catalyst, which may subject them to high, retroactive interest charges if they don't pay their bill in a certain promotional period. 'When patients are now faced with these difficult decisions of not being able to pay off these bills right away — worried about how it's going to impact their credit scores, losing their insurance, still needing healthcare — they may be lured into signing up for one of these payment products,' said Shah. Emma Ockerman is a reporter covering the economy and labor for Yahoo Finance. You can reach her at Sign up for the Mind Your Money newsletter Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Forbes
a day ago
- Health
- Forbes
Pretending We Don't Owe Money Doesn't Mean We Don't Owe Money
DORCHESTER - APRIL 05: Dominique Entzminger, a physician assistant of family medicine, wears a ... More stethoscope during an examination at the Codman Square Health Center April 5, 2006 in Dorchester, Massachusetts. State lawmakers approved a health care reform bill March 4 that would make Massachusetts the first state in the nation to require all its citizens have some form of health insurance. Governor Mitt Romney is scheduled to sign the bill next week. (Photo by) Markets always have their say. This was recently acknowledged, at least implicitly, by a federal judge in Texas. Judge Sean Jordan ruled against a Biden-era decree from the Consumer Financial Protection Bureau that tens of billions worth of medical debt be excluded from credit reports. Jordan should be cheered for his ruling. But not just because it signals rationality on his part. Jordan most rates credit for protecting the health of consumers. Think about it. As evidenced by the $49 billion worth of medical debt that the CFPB wanted removed from the credit reports of 15 million people, there's a very real need for medical-related care in the United States. Put another way, no one runs up medical debt just because. Which speaks to the foolhardy nature of the initial CFPB decree. Imagine if it had held such that debt related to healthcare could be left off credit reports. If so, it would on its face increase the incentive among those with medical debt to cease paying it, all based on the presumption that a failure to keep current on debts wouldn't shrink one's credit score. It might seem harmless to some at first glance, but for the problem that unpaid bills don't just happen. There's a market reaction to a failure to pay. Specifically, a rising tendency for medical debts to go unpaid would most certainly result in reduced availability of medical care for all would-be patients. What else would doctors and medical professionals be expected to do? If going forward the pretense will be that medical debt doesn't exist on the matter of credit reports, logic dictates that medical care on credit would have to shrink to reflect the decree. Which is just a comment that when governments err to protect a few, or even millions, the burden is suffered by exponentially more. If there's no punishment in a credit sense for ignoring certain bills, then it only makes sense that would-be patients will similarly be ignored to the extent that their capacity to pay isn't trusted as much thanks to a few, or many, bad apples. And it won't just be limited to medical care. See yet again how much in the way of debt that the CFPB wanted erased from credit reports. Stated simply, $49 billion isn't exactly a tiny number. Which means that if it can no longer reflect on credit reports, the worth of credit reports themselves will decline. It's the housing equivalent of a home appraisal, albeit one that lacks crucial information like square footage, bedroom and bathroom count, along with whether the house has central air conditioning. Would you buy such a house sight unseen? Hopefully the question answers itself. Ideally it also explains the importance of credit reports reflecting reality, as opposed to a truncated version of the latter. Absent the truth, how can any provider of goods and services (not just a doctor or a hospital) confidently provide them on a to-be-paid basis? Which is a reminder of the point made at the beginning of this piece, that markets always have their say. It's worth remembering as states contemplate doing locally what Judge Jordan stood athwart nationally. That which obscures reality doesn't alter reality, which means statewide decrees meant to mirror the CFPB's attempted one will not just harm consumer health, but their ability to attain goods and services more broadly.
CTV News
a day ago
- Business
- CTV News
Equifax beats quarterly profit estimate, raises annual revenue forecast
A monitor displays Equifax Inc. signage on the floor of the New York Stock Exchange (NYSE) in New York. Credit bureau Equifax beat Street estimates for second-quarter profit on Tuesday, helped by a smaller-than-expected drop in inquiries for mortgage credit reports, and raised its annual revenue forecast marginally. Mortgage inquiries buoyed Equifax's second-quarter results in an otherwise subdued mortgage market, with the 30-year mortgage rate — the interest rate for the most popular U.S. home loan — at lower levels than a year earlier when the Federal Reserve's benchmark interest rate was at a record high. U.S. mortgage inquiries fell eight per cent in the quarter from a year earlier, better than Equifax's expectation of an 11 per cent decline. In the second quarter of 2024, the metric fell by 13 per cent. However, the U.S. mortgage market has seen suppressed loan demand amid rising Treasury yields and economic uncertainties, including fluctuating trade policies from President Donald Trump, and global political tensions. Elevated mortgage rates have discouraged borrowers. That acted as a headwind for Equifax, which sells credit reports and data analytics to consumers and mortgage lenders, as per its earnings report. The company now expects U.S. mortgage inquiries to decline by 11 per cent in 2025, a slight upgrade from the 12 per cent expected in the previous quarter. This helped the company in revising its annual revenue guidance to the range of US$5.97 billion to $6.04 billion, from $5.91 billion to $6.03 billion. Analysts were expecting 2025 revenue of $6 billion, according to estimates compiled by LSEG. On an adjusted basis, Equifax earned $249.7 million, or $2 per share, in the three months ended June 30, compared with $226.6 million or, $1.82 per share, in the year earlier. Analysts had expected a profit of $1.92 apiece. The company's shares, which have gained nearly two per cent in 2025, were up marginally in trading before the bell. (Reporting by Pritam Biswas in Bengaluru; Editing by Maju Samuel)
Washington Post
a day ago
- Business
- Washington Post
A rule lifting medical debt from credit scores was voided. What will change?
An estimated one-fifth of U.S. households have medical debt on their credit reports, a burden that makes it more expensive for them to buy homes, finance new cars and, in some cases, more difficult to obtain jobs. A recent court decision has now kept that system in place. A Biden-era rule, announced last summer but never put into effect, sought to forbid credit reporting agencies, including Equifax, Experian and TransUnion, from using medical debts over $500 on the detailed credit history reports that lenders use to judge creditworthiness. Amid opposition from industry groups and the Trump administration, a federal judge then struck down the rule earlier this month.
