Copyright newrepublic
The CFPB had previously issued guidance allowing states to pass laws nixing the inclusion of medical debt, but that rule was revoked in May 2025. The CFPB published the latest interpretive rule to “clarify that the Fair Credit Reporting Act (FCRA) generally preempts State laws that touch on broad areas of credit reporting.” The new rule could pose serious problems for American consumers, who owe a collective $220 million in medical debt, and could prevent them from securing loans, buying homes, or obtaining lines of credit. The CFPB said that courts ought to overturn rules protecting consumers from including this potentially damaging information from their credit reports, which have been implemented in 15 states, including New York, Maryland, Maine, California, and Colorado. This latest guidance comes at a difficult time, as health insurance premiums are expected to spike by thousands of dollars a year unless Congress can agree to extend Obamacare subsidies. Should those tax credits expire, the number of Americans drowning in medical bills is likely to increase.
