AG Campbell wants to prevent medical debt from dinging credit scores
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Massachusetts Attorney General Andrea Campbell. Photo: Steph Solis/Axios
Attorney General Andrea Campbell wants Massachusetts to prohibit health care providers from reporting medical debt to credit reporting agencies.
Why it matters: The moratorium, one of several recommendations in Campbell's report about medical debt released Wednesday, has gained steam in the federal government and several states as a way to help residents struggling to cover costs.
What they're saying: "The vast majority of Massachusetts residents have some form of health care coverage, but regardless of coverage status, out-of-pocket costs remain unaffordable," Campbell said in a statement.
Zoom out: The Consumer Financial Protection Bureau proposed a rule this year to remove medical bills from Americans' credit reports.
- It also would prohibit creditors from relying on medical bills when considering a borrower's credit application.
Yes, but: The rule could get sidelined under a second Trump administration, which banking leaders predict will limit the CFPB's scope altogether.
The latest: Campbell plans to discuss the report Thursday at the Health Policy Commission's Annual Cost Trends Hearing.
Other recommendations include:
- Tracking by community how much households get billed for medical services versus how much they can afford to pay. That would become the basis of a state health care affordability benchmark, Campbell says.
- Making providers allow discounts for deductibles and other policy changes to protect consumers.
- Making providers proactively offer affordable payment plans.
By the numbers: Massachusetts residents have a median debt of $1,438 in collections, per the Urban Institute's latest data, cited in the AG's report.
- That doesn't account for medical debt that hasn't yet gone to collections.
- Lower-income residents were more likely to spend a higher share of their income on cost-sharing for medical services — co-pays, co-insurance and deductibles — compared with higher-income residents.
- They're also more likely to face hospital medical debt.
Between the lines: The report highlighted several factors increasing medical debt overall for Massachusetts residents and exacerbating debt for lower-income residents:
- The number of residents who get behavioral health care out of network
- Other unexpected out-of-network costs, like ambulance rides.
- The shift away from plans with no deductibles, which tend to have higher premiums than higher-deductible plans — a trend that has affected residents at all income levels.