Overview
- The CFPB issued an Oct. 28 interpretive rule asserting the Fair Credit Reporting Act generally preempts state laws that bar or limit medical-debt reporting, though the guidance is not legally binding.
- Brownstein, on behalf of ACA International, filed a federal suit challenging Colorado’s HB 23-1126, arguing FCRA preemption and claiming the law unlawfully restricts accurate commercial speech under the First Amendment.
- The litigation follows a blocked Biden-era CFPB rule from January that would have curbed medical-debt reporting nationally, which the Trump administration declined to defend in court.
- Between 14 and 15 states have enacted protections restricting medical-debt entries on credit reports, including California, Colorado, Maine, New York, Virginia and Washington, leaving those laws’ futures uncertain.
- Consumer advocates warn that restoring medical-debt reporting could damage credit access for millions, with KFF estimating $220 billion in unpaid medical bills in 2024 and about 14 million adults owing more than $1,000.