Polls show that this Congress is among the most unpopular in recorded history, and the mid-term elections are now just eight months away. So you'd think leaders on Capitol Hill would be desperately casting around for some easy wins -- problems they can fix in a bipartisan fashion between now and November.
Well, I've got a suggestion: pass a law to safeguard the credit scores of Americans in the face of dysfunctional medical billing and collection processes that consumers can't make heads or tails out of.
This is the very picture of low-hanging fruit for a bunch of reasons. First, there isn't much debate as to whether medical debt is hurting the credit of a great many upstanding citizens. A 2012 Federal Trade Commission report found that some 40 million Americans have mistakes on their credit report, mistakes that often drive up their borrowing costs, and a good share of these mistakes are related to medical bills. The problem as Elizabeth Rosenthal described
it this weekend in the New York Times is that medical bills are super confusing and before consumers can sort them out, unpaid debts can be reported to credit agencies.
Medical debt is also an intensely unfair issue because low-income people are more likely to have bad insurance policies or no insurance at all, and thus most likely to find themselves hammered by medical bills. (See the report
Demos did on this issue a few years back.) In turn, these same Americans can find themselves forced to borrow at subprime rates after their credit has been ruined by debts they would never have had in any other advanced country in the world.
A second appealing dimension of the medical debt issue -- if you're a deadbeat Congressman about to face constituents wondering what you've been doing for the past two years -- is that voters can easily relate to it. Over 70 million Americans annually get a medical bill, and most find them utterly bewildering. They are often uncertain whether they should be paying the bill or not, what portion they owe, and so on. I, for example, have been going back and forth for nearly a year with my insurance company about a bill that I keep getting that my insurer says I shouldn't have to pay, but somehow this never gets resolved and the bill recently ended up in the hands of a collection agency.
Third, this is low-hanging fruit because the problem has an easy solution: force credit bureaus to handle medical differently from other kinds of debt and make them quickly remove paid and settled medical debt from credit records.
Fourth, this an easy win because legislation to regulate medical debt, which was first introduced in Congress in 2010, has decent bipartisan support: The Medical Debt Relief Act introduced in the 111th and 112 Congresses had Republican co-sponsors both times.
Leading Republicans, like Marco Rubio and Bob Jindal, have talked a lot lately about how the GOP needs to show that it sticks up for ordinary people and isn't just a branch of big business. Medical debt is a great issue to tackle that could make this point.
What politician doesn't want to side with tens of millions of agitated Americans over a handful of collection companies and credit bureaus that are happy with business as usual? This one is a no-brainer.