It is perhaps unsurprising that many Americans are besieged by medical bills, especially since thethe pandemic continues. Perhaps more telling is that it’s often a debt they’ve already paid or don’t actually owe.
in a new reportThe Consumer Financial Protection Bureau found that the most common debt collection complaints last year involved efforts to collect a bill that they believed was not theirs.
“In medical debt collection complaints, this issue accounts for almost half of the complaints and, importantly, the volume of complaints about it has increased,” the federal agency said, noting that such bills end up often on people’s credit reports and force them on a bureaucratic hamster wheel to erase their financial records.
Between 2018 and 2021, public complaints about attempts to collect medical bills that consumers said they did not owe jumped 31%, the CFPB found. About 1 in 5 U.S. households carry health care debt, according to federal data. Medical bills are the most commonly reported item on consumer credit reports, according to regulators.
“People also report learning about an unpaid medical bill only after experiencing a drop in their credit score and being told that only paying the bill would remove negative collection information from their credit report,” the CFPB added. .
The CFPB said that in 2021 it had sent more than 750,000 complaints to around 3,400 companies for review. Among the agency’s other findings:
- The median medical debt in the United States is $310.
- In 2021, 15% of debt collection complaints were about attempts to collect a medical bill.
- Consumers who receive collection notices for a medical bill often say they don’t know the provider listed.
- Consumers also report that collection notices often contain large amounts of personal health information.
- Many Americans say they pay their medical bills to avoid negative financial and personal consequences, even if they believe the debt is 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 pressured to pay medical bills that they have already paid or never had to pay,” 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 they do not owe.”
In March, major credit rating companies Equifax, Experian and TransUnion said they planned to remove most medical debt from consumer credit reports starting this summer.
Last year, Congress sought to address the issue of runway medical costs bywhich protects people with health insurance against being billed for emergency medical care outside of an insurer’s network.
Under the law, patients are still responsible for the deductibles and co-payments they would normally pay under their plan, but they can only be billed at the prevailing rate in their plan’s network.