AN ACT to amend Tennessee Code Annotated, Title 9, Chapter 8; Title 16; Title 18; Title 20; Title 21; Title 27; Title 28; Title 29; Title 45; Title 47; Title 63 and Title 68, relative to credit data.
By enacting HB0539, Tennessee aims to alleviate some of the burdens associated with medical debt that currently impact consumer credit scores. Supporters of the bill argue that this could provide much-needed relief for individuals facing financial difficulties due to medical expenses, potentially reducing the stress associated with healthcare costs and enabling better financial rehabilitation for those affected. It also aims to foster a more equitable healthcare system where individuals are less penalized for obtaining necessary medical treatment due to financial constraints.
House Bill 0539 proposes significant amendments to Tennessee Code Annotated regarding the reporting of medical debt. The bill states that, beginning on July 1, 2025, healthcare providers are prohibited from reporting any medical debt to consumer reporting agencies. This change is aimed at protecting patients from the negative implications of having medical debt reflect on their credit reports, which can affect their ability to secure loans or housing. The bill also ensures that while the reporting of debt to consumer agencies is restricted, healthcare providers retain the right to report medical debts to collection agencies, thus maintaining a channel for pursuing unpaid medical bills.
It is important to note that a violation of the provisions in this bill is categorized as a violation of the Tennessee Consumer Protection Act of 1977, thus empowering the attorney general with the authority to investigate and enforce compliance against entities that might fail to adhere to these new regulations. This legal backing emphasizes the state's commitment to consumer rights in the realm of medical debt.
However, this bill has sparked some concern, especially among creditors and debt collection agencies. Critics argue that prohibiting the reporting of medical debt to consumer reporting agencies may undermine the financial accountability of patients, encouraging some individuals to accumulate unpaid debts without facing traditional credit repercussions. There are concerns that this could lead to increased financial risks for healthcare providers who may not receive payment for the services rendered.