If H.R. 3421 passes—it may set a precedent for other forms of debt reporting—thus corrupting the FICO score system. In my opinion, Rep Kilroy has not been informed of the process it would take to dismantle and rebuild this existing process, nor the technology burdens that would be placed on CRA’s & CA’s to comply.

According the verbage, this bill only applies to PAID OFF medical debt, i do not forsee any precedence being set for any other consumer finance account, as those are controllable debts. Medical debt, and the negligence of health service organizations to attempt to contact and properly bill those affected are different. (including those that are properly insured)

No technology adjustments would have to be implemented.

The consumer can dispute the items from their CRA, increasing revenue for these CRA’s from those paying for their reports. The dispute system is already in place. The FICO system is a derivative of information ON THE REPORT, having an item removed has no effect on the inner workings of the FICO score.

I have to agree with adamroof, currently many consumers have no incentive to pay medical collections unless sued because the collection is still listed on your report and factors in to FICO the same regardless of whether the debt is paid or unpaid. Many consumers would therefore have incentive to pay these outstanding debts because they would be completely removed from their credit report.

I support this bill. While I can understand the opposition – “what gets to come off your credit report next?” Medical bills are unlike typical extensions of credit; there are no terms and conditions, no fees, rates, costs, limitations and other terms to read before signing up. When you are in the emergency room and need emergency care, you get it and worry about the bills when they come. Once these bills are paid, it should be no problem to drop it from your CR. Unexpected medical bills isn’t really predictive of how one manages their bills, especially if they continue all their other obligations as agreed and eventually paid off the unexpected med bills. On the other hand, what is next? “delete mortgages from those evil mortgage brokers that set you up?” I do support this bill, because it is in this case you are not able to read through the cost, rates, terms and conditions. If you get the chance to read the rates, terms and conditions before signing up, then I wouldn’t support it.

This bill would not change anything about the dispute process already in place, nor would it change the formula of the FICO scoring system, nor would it allow people with unpaid debt to just get off scott free. For those of us who HAVE paid their medical debt IN FULL, it is unfair to have our credit and – by extension – our financial wellbeing disrupted for costs which we did not choose to incur. Incurring consumer debt or any other debt is a person’s choice and responsbility. Getting sick and going to the ER could happen to anyone OF ALL WALKS OF LIFE, of ALL INCOME LEVELS, insured or uninsured, and penalizing a human being who paid the bill in good faith just the same as those who are financially irresponsible is absurd.

They promulgated that Medical Debt relief act to protect the consumers. A lot of large companies have been hit hard by today’s recession, and one of the measures they’re taking to cut expenditures is to scale back or eliminate matching contributions to employee’s 401(k) retirement accounts. If this is an employee straight out of college, it might not be such a big deal, but workers nearing retirement having a cessation of contribution into the 401(k) retirement accounts can be a serious problem. The 401(k), along with Roth IRAs, is the most common retirement savings and investment method. If employers don’t resume making any 401(k) retirement accounts contributions any time soon, a lot of people will need debt relief after retirement, when they shouldn’t be worrying about anything.

This bill will have the ability to stop penalizing bill paying citizens. I am one who has hit rock bottom, but have rebounded. Unfortantely medical bills that are marked “Paid” still continue to haunt me. I can finally afford to purchase a new home, but cannot get a mortgage because of 4 medical bills that still pull my score down they have been paid for over 4 years. Having to endure them for another 3 1/2 years is unfair. Medical billers are the problem for most collection claims anyway, they know by law if you negotiate a payment plan they have to accept it, even if a single dollar a week, they want to get a bulk sum quickly, so they sell them to collection agencies shortly after recieving insurance payments(if applicable)then send notice for one week and then bam, right to collections. This occurs normally a year after the service is performed. THis practice alone is criminal and should be changed! THis is a good start though, make it happen fast!

What is the status of this bill? Are things just being held up because of the medical reform bill trying to go through? When is this bill supposed to go before a house vote? I have not heard or seen of any progress in quite some time.. I’m REALLY hoping to see this legislation get passed.

I too haven’t heard any news on this, but looking forward to how things will play out. I’m sure law makers are getting some heat about this potential law. In any case, I’ve been keeping an eye on this for a while and nothing new since around the Aug. break has come up.

ADH1982 & Blattd – Well said!

I personally think medical debts shouldn’t be posted on someone’s credit report at all. Simply because you aren’t able to know before hand what the fees, terms and/or conditions will be. It’s equivalent to getting a credit card, without being allowed to know the fees, rates, terms and conditions. All of which is against the law! You have the chance to read what you’re signing up for before you are liable for it. Whether you do read it, or whether you understand it is a whole other issue… At least you’re given the chance to know what bill is coming, with medical bills – you don’t. Instead you wait a month or two waiting for all the surprise bills to start coming in.

I too support this bill. If it’s your debt, pay it. Once it’s paid it should not haunt you for any reason.