ATLANTA — On Thursday, Vice President Kamala Harris announced the Biden administration wanted to remove medical debt from the credit reporting system as a way to ease burdens on American families.
During the virtual conference, Harris said the issue was critical to millions of Americans and was a tremendous burden.
Citing the figure that one of every three adults, about 100 million Americans according to the Kaiser Foundation, struggles with unpaid medical bills, Harris said those debts have harmed credit scores.
Harris said she and President Joe Biden want to change how credit reports are structured to remove medical debt as a factor in determining someone’s economic future.
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To that end, the Consumer Financial Protection Bureau is proposing a new rule that would block medical debt from impacting credit scores.
Harris said once that rule was finalized, it would mean creditors could not use medical debts to determine credit eligibility, leading to improved credit scores of millions of Americans.
For Georgia, that could potentially impact the 17% of state residents who had medical debt in collections, as of February 2022, according to the Urban Institute. Put simply, about one in six Georgians have medical debt in collections.
The same report said Georgians have an average of $1,854 in medical debt each.
In March 2022, the three major credit reporting agencies, Equifax, Experian and TransUnion said they would be taking off 70% of all medical debts from their credit reporting systems.
The White House said the next month that federal agencies with grant or loan programs would no longer include medical debt when checking eligibility, with the decision impacting programs from the U.S. Departments of Agriculture and Housing and Urban Development, among others.
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