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September 11, 2024
Authors
David Burda
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Consumerism Economics System Dynamics
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Taking the Medical Debt Foot Off the Throats of Consumers

Any story about medical debt is inherently negative. I get it, and I love it. As a journalist, I’m inherently a glass-half-empty kind of person. But as I’ve mentioned before, when I do see good news, I’m compelled to write about it. Even medical debt.

The Consumer Financial Protection Bureau earlier this month came out with its latest annual report on the Fair Debt Collection Practices Act. Buried in the 54-page report are two pieces of good news.

First, consumers are complaining less about medical debt. Last year, consumers filed 7,000 actionable complaints about medical debt to the CFPB. That represented 11% of all actionable complaints in 2023. That’s down from 8,500 actionable complaints about medical debt in 2022. Medical debt represented 15% of all actionable complaints that year.

For what it’s worth, credit card debt drew the most consumer complaints in both 2024 and 2023.

Second, medical debt is shrinking as a share of consumers’ overall debt. Medical debt represented 36% of all consumer debt in 2023, according to the CFPB. That was still No. 1 with banking/financial a distant No. 2 at 19%. But it’s down from 57% of all consumers debt in 2022.

“This decline is likely related to the April 2023 credit reporting change, in which the three nationwide consumer reporting companies (Equifax, Experian and TransUnion) announced that they removed unpaid medical collections under $500 from consumer credit reports,” the CFPB said.

Who’s to argue with the CFPB?

But I’m thinking the two bits of good news in an otherwise gloomy report are hints that hospitals, health systems, medical practices and debt collection agencies are taking their collective foot off the throats of consumers with unpaid medical bills just a little. They’re easing up because the problem of unaffordable medical debt has seeped into the national consciousness thanks to scorching research, reports, surveys, publicity and media coverage.

Who needs that, especially in an election year?

Thanks for reading.

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About the Author

David Burda

David Burda began covering healthcare in 1983 and hasn’t stopped since. Dave writes this monthly column “Burda on Healthcare,” contributes weekly blog posts, manages our weekly newsletter 4sight Friday, and hosts our weekly Roundup podcast. Dave believes that healthcare is a business like any other business, and customers — patients — are king. If you do what’s right for patients, good business results will follow.

Dave’s personnel experiences with the healthcare system both as a patient and family caregiver have shaped his point of view. It’s also been shaped by covering the industry for 40 years as a reporter and editor. He worked at Modern Healthcare for 25 years, the last 11 as editor.

Prior to Modern Healthcare, he did stints at the American Medical Record Association (now AHIMA) and the American Hospital Association. After Modern Healthcare, he wrote a monthly column for Twin Cities Business explaining healthcare trends to a business audience, and he developed and executed content marketing plans for leading healthcare corporations as the editorial director for healthcare strategies at MSP Communications.

When he’s not reading and writing about healthcare, Dave spends his time riding the trails of DuPage County, IL, on his bike, tending his vegetable garden and daydreaming about being a lobster fisherman in Maine. He lives in Wheaton, IL, with his lovely wife of 40 years and his three children, none of whom want to be journalists or lobster fishermen.

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