[ad_1]
Republican voters are among the biggest beneficiaries
April 10, 2025
Key takeaways:
- A rule banning medical debt from credit reports is under threat from the industry and Congressional Republicans.
- Medical debt varies widely across the U.S., with the states of Oklahoma, Wyoming,Tennessee, Texas and Nevada being the top five states with the highest shares in collection on credit reports.
- Congressional districts in red-leaning states often have some of the highest shares of medical debt in collections, including Texas’s 13th district, Tennessee’s 9th district,Oklahoma’s 3rd district, Georgia’s 8th district and Louisiana’s 3rd district.
Parts of the country would benefitmuch more from a rule under threat thateliminates medical debt from credit reports.
A rule finalized in January by the Consumer Financial Protection Bureau (CFPB) bans lenders from considering medical debt in determining credit, including for mortgages and other loans.
The rule was supposed to go into effect in March, but a federal court issued a 90-day stay after the industry sued, postponing the effective date to June 15.
Now, Republicans in Congress have overturned the rule, subject to President Trump’s signing off, even thoughmany ofthe districts theyrepresent would benefit most.
Medical debt varies widely by state and congressional districts and around 9.7 million Americans had medical debt in collections in their creditreports, according to a studyfrom the nonprofit Urban Institute, a left-leaning think tank that reviewed August 2024 credit bureau data.
The median amount owed by Americans with medical debt in collections was $1,465, flat from the previous year, the Urban Institute said.
As of August 2024, 4.1% of Americans had medical debt in collections on their credit reports, but the number is often much higher.
Texas’s 13th Congressional district had the highest share of medical debt in collections on credit reports, with 15.1%, followed by Tennessee’s 9th district (12.2%), Texas’s 15th district (12.2%), Oklahomas’s 3rd district (11.5%) and Texas’s 25th district (11.5%).
By state, Oklahoma had the highest share of medical debt in collections on credit reports, with 8.8%, followed by Wyoming (8.5%),Tennessee (8.2%), Texas (7.7%) and Nevada (7.3%).
Some states have already eliminated medical debt from credit reports.
In 2023, Colorado and New York banned the debt from reports, whileCalifornia, Connecticut, Illinois, Minnesota, New Jersey, Rhode Island and Virginia did the same in 2024 before the data was collected by the Urban Institute.
And in 2023, national credit reporting agencies already voluntarily started removing all unpaid medical debt items under $500 from credit reports.
“As policymakers debate whether to uphold the CFPB rule, other emerging policy developments could have important implications for the nationwide prevalence of medical debt, regardless of whether that debt appears on credit reports,” Urban Institute said.
Sign up below for The Daily Consumer, our newsletter on the latest consumer news, including recalls, scams, lawsuits and more.
.newsletter-form {
display: flex;
max-width: 400px;
margin: 20px auto;
background: #f8f9fa;
padding: 10px;
border-radius: 8px;
box-shadow: 0 4px 6px rgba(0, 0, 0, 0.1);
}
.newsletter-input {
flex: 1;
padding: 10px;
border: 1px solid #ccc;
border-radius: 5px 0 0 5px;
font-size: 16px;
outline: none;
}
.newsletter-input:focus {
border-color: #007bff;
}
.newsletter-button {
background: #2976D1;
color: white;
border: none;
padding: 10px 15px;
font-size: 16px;
border-radius: 0 5px 5px 0;
cursor: pointer;
transition: background 0.3s ease;
}
.newsletter-button:hover {
background: #0056b3;
}
[ad_2]
#Americans #benefit #ban #medical #debt #credit #reports