The American Bankers Association (ABA), the Association of Credit Collection Professionals (ACA International), the U.S. Chamber of Commerce, Synchrony, and the National Consumer Law Center (NCLC) comment on the Consumer Financial Protection System. I have submitted my letter. Bureau of Information Requests for Medical Credit Cards and Other Financing Products Used to Pay Medical Expenses. Banking industry groups stress that the Consumer Financial Protection Bureau (CFPB) does not have the authority to regulate health care and urge the CFPB not to take actions that limit health care payment options to avoid unintended consequences. ing.
In July, the CFPB, jointly with the U.S. Department of Health and Human Services (HHS) and the U.S. Department of the Treasury (Treasury), issued a Request for Information (RFI) on Health Payment Products. As we previously blogged, the agency was seeking information on interest rates and fees for medical payment products, as well as information on:
- Marketing, application and approval processes.
- Outstanding Debts for Medical Payment Products.
- Types of financial institutions offering medical payment products.
- Patient understanding of the risks and risks of medical payment products.
- How health care payment products exacerbate existing problems in health care billing and collection.and
- Incentives offered to health care providers to promote health care payment products and how those incentives affect health care providers’ promotion of such products to patients.
ABA, ACA International, Chamber, Synchrony, and NCLC submitted comment letters in response to the RFI.
ABA. The ABA commented that the CFPB does not have the legal authority to directly or indirectly regulate health care, and urged the CFPB to “promote a range of fair and responsible options for payment for health care products and services; “Pursue policies that allow consumers to choose from: respond to their needs. ” The ABA reminded financial institutions that lending products are highly regulated and require comprehensive disclosure of credit costs so that consumers can make informed choices. The ABA warned the CFPB to refrain from actions that would reduce consumer payment options that could create barriers to accessing health care services. Regarding deferred interest options, the ABA emphasized that consumers understand these plans, as evidenced by the 80% payoff rate before interest begins accruing.
ACA International. ACA International expressed concern about the CFPB’s previous actions to exclude medical debt from credit reports (as previously blogged) and its failure to engage with healthcare providers. They emphasized that the CFPB cannot rewrite the Fair Credit Reporting Act and reminded the CFPB that legislation is a function of Congress, not an arbitrary decision. ACA International expressed similar concerns about the CFPB’s authority to regulate health care and consumer harm expressed by the ABA.
Chamber. The Chamber emphasized that financial service providers allow consumers to pay for incurred medical expenses through a variety of payment products (credit cards, debit cards, checks, loans). Furthermore, it noted that these payment products are already subject to numerous regulatory requirements and consumer protections. The chamber emphasized that “consumer financial services providers do not participate in the sale or provision of health care services, the health insurance market, or the health care billing system.” The Chamber also asked the CFPB to consider three important points:
- The CFPB should not seek to use payment regulations to address perceived concerns about medical billing or business practices.
- Any policy action based on the unique treatment of medical debt will be misguided.
- The CFPB should not prevent the use of certain payment products.
Sync. Synchrony offered to share its experience with the agency with CareCredit, a consumer-issued healthcare and wellness care branded credit card and credit card network brand. Synchrony shares background on its CareCredit card product, used for elective medical procedures such as veterinary clinics, dentistry, cosmetic procedures, and LASIK surgery, and how the card enhances access to care and leads the industry. I explained how to establish a practice. Synchrony said the right public policy choice is to allow consumers to choose how they pay for access to health care. They also highlighted that the majority of consumers (75-80%) do not pay interest on deferred interest plans, and focus groups indicate that consumers are satisfied with this payment option. Addressing the CFPB’s concerns about the complexity of deferred interest plans and the perceived harm to subprime cardholders, Synchrony noted that subprime borrowers account for only 8% of all deferred interest loans.
NCLC. In contrast, the NCLC provides a legal basis for medical payment products, such as when the loan amount should have been covered by insurance, when a payment was made for an amount that was erroneously billed, or when the consumer was able to avoid interest. focused on the risks posed to consumers by the use of Your healthcare provider’s interest-free payment plan, and if such debt is not flagged as medical debt and reported on your credit report.In particular, consumers face some of the same risks when paying by cash or check, and these risks are not alleviated by further regulation of health care payments. NCLC’s comment letter explains how health care providers do not provide clear marketing disclosures about the financing options offered. As noted above, there are existing laws and regulations that address marketing and disclosure practices, and unfair sales practices are addressed by laws that prevent unfair, deceptive, and abusive acts and practices. Masu. “Recommended” letter[s] The CFPB prohibits lenders from charging accounts or issuing funds before a medical procedure is completed or a medical product is delivered. ” This comment indicates that lenders are in a position to police billing practices for medical facilities, are entitled to receive protected health information that verifies medical services performed, and respect patient privacy before approving credit card transactions. suggests that they are not aware of how payment authorization works. The NCLC recommends that the CFPB should conduct further investigation into medical credit cards, take further enforcement actions, and ban deferred interest on all credit cards, but that this ban should not affect the benefit of deferred interest plans. It clearly ignores the harm it causes to the 80% of consumers affected.
We will continue to monitor further developments from this RFI and any policy statements or proposed rulemakings by the CFPB related to medical debt and payment.
