Senators call for consumer protection against “involuntary” medical debt – The Madison Leader Gazette

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A group of Democratic senators is calling on the Consumer Financial Protection Bureau (CFPB) to tackle the country’s ever-growing medical debt.

Meaning. Chris Murphy (D-CT), Chris van Hollen (D-MD), Tammy Baldwin (D-WI), Cory Booker (D-NJ), Elizabeth Warren (D-MA) and Richard Blumenthal (D-CT) wrote a letter to CFPB expressing concerns about the financial burden many Americans may face as a result of COVID-19.

“While the COVID relief programs passed by Congress have helped cover some of these costs through financial grants and coverage of COVID-19 vaccines and tests, consumers are still paying the health costs associated with treating disease, ”Senators said. “For Americans who have sought treatment in their networks, they can bear the full cost of their COVID-19 treatments. “

A woman hangs an American flag in a fence in front of the United States Navy hospital ship Mercy on March 28, 2020 at the Port of Los Angeles in Los Angeles, California. (Photo by APU GOMES / AFP via Getty Images)

A LendingTree survey found that a majority of Americans (60%) had medical debt with average costs ranging between $ 5,000 and $ 9,999. The main causes were emergency room visits (39%), visits to doctors and specialists (28%), childbirth and related care (22%) and dental care (20%).

“The problem is that [most] medical debt is involuntary, ”Senator Murphy told Yahoo Finance. “It’s not a choice.”

Emergency room visits are the number one cause of medical debt.  (Graphic: LendingTree)

Emergency room visits are the number one cause of medical debt. (Graphic: LendingTree)

Senators have drawn up a list of actions the CFPB must take to address the problem.

Suggestions include a ban on providing medical debt collection items to credit reporting agencies; require debt collectors to disclose any applicable financial assistance or potential coverage plan; work with the IRS to post an FAQ on Obamacare’s charitable care arrangements; require collection agents to refrain from collecting or reporting individuals if they say they are appealing or contesting an insurance denial or billing, or requesting financial assistance; limit the number of collection calls made per consumer; carry out additional analysis of received medical debt complaints; and publish a corresponding report for use by researchers and policy makers.

“We have received the letter and are reviewing it,” CFPB told Yahoo Finance in a statement. “We will continue to dialogue with Congress on the issue of consumer debt for health care. “

These deductibles can lead to significant indebtedness ”

Medical debt is the leading cause of bankruptcy in the United States As of April 2021, an estimated 21 million Americans with $ 46 billion in medical debt were facing collections, meaning a third-party debt collector is trying to get the money owed.

Jen Taylor, senior director of federal relations at Families USDA, a non-partisan consumer health care organization, called some of the collection agent’s practices “industry abuse.”

“The current system is too expensive, inefficient and in many ways flawed for consumers who are still struggling financially with the worst health and economic crisis of the century,” Taylor told Yahoo Finance. “We are delighted to see this letter and other recent actions by members of Congress and the administration to end surprise medical bills, eliminate the burden of medical debt, and prioritize protecting families from abuse. Of the industry.”

Murphy noted that while the Affordable Care Act (also known as Obamacare) has helped millions of Americans lose employer-sponsored insurance amid the pandemic, more can be done.

Senator Chris Murphy, D-Conn., Speaks during a Senate Foreign Relations Committee hearing on U.S. Middle East policy, on Capitol Hill in Washington, DC, the United States, September 24, 2020. Susan Walsh / Pool via REUTERS

Senator Chris Murphy speaks at a Senate Foreign Relations Committee hearing on US Middle East policy, September 24, 2020. Susan Walsh / Pool via REUTERS

“While the Affordable Care Act has been a gift to people during the pandemic with so many job losses and job changes, it is no surprise that there are people who spend long periods of time. periods without coverage, ”he said. “You have also seen the shift over the past five years towards better cost sharing and higher deductibles. These deductibles can lead to significant debt.

In 2019, the average individual deductible was $ 1,931 and the average family deductible was $ 3,655. Deductibles and premiums represented 11.5% of median household income that year, an increase of 9.1% from the previous decade. However, they only represent about 9% of medical debt.

“The COVID-19 pandemic has exposed the many cracks that remain in our healthcare system that people fall into, sometimes collapse, regarding debts incurred for their healthcare,” they wrote. “It’s time to reconsider the debt burden of medical consumers. “

Made with flourish

$ 10.3 billion in crowdfunding campaigns

The Biden administration has started taking action to address the issue of health care costs.

Earlier this week, the White House introduced a bill that President Trump had implemented – the No Surprise Act – that would protect consumers from surprise medical bills and billing of the balance.

“While it’s good that we have fewer surprise bills, medical debt normally accumulates because you have to have health care procedures performed that are mandatory to save your life,” Murphy said. “There will be times when someone can avoid a bigger bill than necessary, but I don’t think the legislation will have a dramatic downward impact on the number of people who have significant medical debt.”

In the meantime, Americans increasingly rely on the generosity of others.

RIP Medical Debt, a New York-based 501 charity that uses donations to buy off people’s medical debt, recently announced a $ 278 million purchase of medical debt owed by approximately 82,000 patients in the Tennessee and areas from Virginia.

Crowdfunding has become increasingly popular.  (Graphic: JAMA)

Crowdfunding has become increasingly popular. (Graphic: JAMA)

Americans also use crowdfunding sites to raise money to pay off medical debt. A Journal of the American Medical Association (JAMA) study found that between May 2010 and December 2018, 26.7% of the 1,056,455 fundraisers on crowdfunding site GoFundMe were for health-related costs. And these health-related campaigns have sought a collective total of nearly $ 10.3 billion and raised around $ 3.7 billion.

“It’s really fascinating, but it’s not the solution,” Murphy said. “The long-term solution is a) to get to a point where no one goes into debt because of medical bills and b) to make sure we treat that debt differently from other consumer debt.”

Adriana Belmonte is a journalist and health policy and policy editor for Yahoo Finance. You can follow her on Twitter @adrianambells. If you would like to share your history of handling medical bills and other health care costs, you can attach it to [email protected]

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