US proposes banning medical debt from credit reports
reuters.com
reuters.com
At the end of the day, hospitals need to pay people, if this increases the losses for hospitals it’ll be bad in the end.
A better rule IMO would be not just transparency which is law, but forced disclosure. Hospitals should have to disclosure full costs and breakdown to insurance and to you for procedures before actions are taken. Bonus points if said procedures are then compared to local, state and national averages.
My impression of US health care is everything involving a hospital being expensive.
Many visitors are actually coming to shop around - meet the doctor, hear their plan, compare with others and then decide.
Even with my insurance, I would go bankrupt if I was at a US hospital every 2-4 weeks for years.
I wouldn't be able to function if I didn't go and I'm sure there's plenty of people like that in the US too... And yes, I'd go bankrupt if I didn't work in software for US company. Sucks to be poor - regardless of which continent.
Mechanics are required to provide a reasonably accurate quote before they begin work. Seems reasonable for doctors too, outside of emergent conditions; I don't need to be woken from surgery to sign off on extra stuff that shows up and needs to be done; but if it's something that's happens in 10%+ of cases, maybe it should be quoted too.
Fun fact, this is already the law. The price of your appendectomy will be $2000-$80000, does that help? Your insurance will also tell you that an appendectomy costs $14 if you get it done out of network and so that's all they're paying.
https://www.cms.gov/priorities/key-initiatives/hospital-pric...
https://www.cms.gov/files/document/hospital-price-transparen...
Hospitals responded by giving quotes with stupidly wide ranges like this -- "your medical procedure will cost.. let me check here, an amount of money." The reason for this does actually make sense but is still impossible to plan around. Hospitals bill for the work they actually do, not "here's the all-inclusive price for an appendectomy" and so they won't/can't say in advance how much it will cost until they do it. They can guess with things like "the average price" but it's still a guess.
Once you leave the world of "necessary" medical care you start to see all-inclusive pricing again because folks are paying for it themselves. You will get an actual price for a nose-job. However this is a bit of a lie because they also require you to have insurance for complications which goes back to a la carte billing so it's better but still not ideal. It's a big ole game of "nobody wants the risk."
Medical debt like this shouldn't exist. Then it wouldn't be on any credit reports.
Because there is no way to offset a family of 3-4 people's full expenses. Especially when the migrants themselves do not contribute much themselves - having low paying jobs, no jobs and so on.
In reality, at least in the US today, I don't trust our government to do this right. They're already way top friendly with the medical industry and have absolutely no idea what it means to plan finances. They waste a ton of tax dollars as-is and have no answer as to why we need taxes when they can literally create trillions in new money every year.
On the medical side, my only caveat would be that I'd want a system that offers more than just modern, western medicine. Anyone that believes strongly in alternstive medicines should have their care covered as well, I'm not sure how that works in other countries that have socialized medical care today.
Acupuncture is paid by medical insurance in Switzerland for example, just another type of medical procedure in their books. Don't know rationale behind it, wikipedia says no clear evidence for it, but I know several people including doctors who report measurable positive differences on themselves or their patients, its just not an instant cure-it-all like some want it to be.
Its always interesting to me when western modern medicine tries to scientifically validate alternative treatments that have been around for much longer. It's such a difficult thing to do, the two approaches are based on such drastically different approaches to health and the body that it really can be like trying to translate a book to English with a Latin dictionary.
It would need to be started again completely.
I dont think the US even has the concept of a public hospital does it?
https://en.wikipedia.org/wiki/List_of_public_hospitals_in_th...
You don't seem to understand the pros and cons of both situations, otherwise you wouldn't be simply proposing a blanket "free for all!"
Once you tell me your 100% foolproof solution for countering regulatory capture and industrial complexes, then you'll have my attention.
We spend the most per capita of G7 countries, and rank last of those on quality of care and service metrics.
Try a thought exercise to brainstorm, reverse engineer, why that might be.
No appeals to thought exercises either. You're the authority on this. Tell HN how this isn't just some convoluted xenophobic rant.
The UK NHS system is on its knees because the conservative government has started selling it out from under the people to guess - US companies.
But all the gammons are spouting exactly the same as he is that its the "immigrants" causing it (even though Brexit was going to solve that problem - right?)
Hopefully my question below helps widen your currently racist perspective to understand economics - just copy/pasting my reply to buffington:
Talk about jumping to conclusions.
You jumping to a race lens says more about you than me. Economics and numbers don't care about race. If you have a system with fixed supply and you flood it with demand, what happens genius?
Also, the flood of immigrants started in just the last few years - and I've been dealing with these issues with the Canadian system for 8+ years.
That said, and to be perfectly clear - I'm not trying to find a reason to argue with you. I'm trying to understand what it means to "spend $800k on US health care as a Canadian."
Normally I'd shrug and move on at this point, but frankly, it's seems a bit crazy to suggest that you, a Canadian, spent $800k on US health care because of immigration. You were the one who spent the money. Why not make it crystal clear how and why that happened?
Indeed, causation vs. correlation - and that reactivity and assumptions is a fundamental issue for society, where people get worked up emotionally and then react based on that - and in the worst case scenario that boils into physical violence; of which authoritarians, tyrants, and bad actors will use to weaponize and direct an ideological-angry mob to help meet their own goals.
Re: "... it's seems a bit crazy to suggest that you, a Canadian, spent $800k on US health care because of immigration."
Because I didn't suggest that, another assumption you made; you know what they say about making assumptions - "it makes an 'ass' of 'u' and 'me'. I added the flooding of immigrants as an additional factor/supportive argument to the untenable situation comment - that flood making things far worse, when there was already a major family doctor/general physician shortage here.
But yes - I plan to make it as crystal clear as I can - including by ideally working with and getting comments from the various doctors and associated organizations/institutions; hopefully voluntarily - but perhaps through official complaint processes when possible to require oversight and a conversation.
Over the years I've written a lot but my pain level is still too high - although knock on wood there may only be 2 more major sources that can be addressed, and then my concentration and executive function may then improve enough where I can start to properly compile and organize my writings into a book, to thoroughly outline exactly the path and challenges I encountered.
You'd probably be a great person to proofread my book draft, if it ever gets done, so I can see what assumptions you may make between unrelated-disconnected statements - so I can try to be more clear; I'd even pay you.
You jumping to a race lens says more about you than me. Economics and numbers don't care about race. If you have a system with fixed supply and you flood it with demand, what happens genius?
Also, the flood of immigrants started in just the last few years - and I've been dealing with these issues with the Canadian system for 8+ years.
If I had encountered doctors who actually understood what they were taught, who actually understood pain and how the nervous system works, then they would have directed diagnostics like imaging in an efficient manner to actually properly problem solve what was going on; instead over the past 12 years I've had to learn myself everything related to what's been going on - as I've been playing whack-a-mole to knock out the next strongest pain, my pain level being so high that my brain wasn't able to actually feel all of the pain sources at once - and it's arguably been only in the last year that I can feel the last few major remaining sources.
One example of this, the last "top expert" in Canada's largest city - Toronto, didn't even follow the literature for diagnosing what I was certain I had based on the symptoms; and there's no penalty for him - meanwhile I had X months of waiting, where leaving a public review of my experience won't really matter - won't allow the public to review testimonials/experiences for themselves - to then decide to go to - and pay a different doctor, where otherwise free market capitalism forces would instead drive more money through word of mouth referrals (etc) to the doctors who show themselves to be competent; and then their skills and knowledge and organization could expand, rather than whatever incompetent-rotted centralized administration is allowing to exist - so long as they toe the line and comply with whatever rules they put in place.
When I told him towards the end of the appointment that he's not even following the literature - where it's more often a diagnostic through exclusion of other sources, rather than due to an obvious cause from imaging [most laypeople don't understand that diagnostic imaging doesn't catch a lot of things - so just because you don't see it on imaging doesn't mean there isn't a cause]; oh, and he couldn't even pull up the MRI imaging because their health network's servers were down, so he couldn't even review the imaging - but still concluded it wasn't the syndrome I had all the symptoms for.
Not too long after that appointment I went to the US - taking me 1.5 years to even find a doctor/surgeon who was able/willing to diagnose me and do the surgery, trying as quickly as possible in my debilitated state, my pain level still how it interferes a lot with my concentration - and went and did the surgery which 100% resolved that pain and symptoms.
Another observation or insight I had is that when in a system where you don't have enough supply for the demand, the doctors who are really good will get plenty of word of mouth referrals - so their schedule will get filled up quickly. That then means it is either 1) new doctors, or 2) doctors no one refers them to specifically - and so the appointment you'll most likely get, the soonest you'll get, will most likely be a doctor in one of those two scenarios.
If I am to try to get compensated for these procedures I'd have to spend likely $100,000s, where you have to find a lawyer that specializes (very very few of them in Canada) in suing the province's health insurance company (e.g. OHIP in Ontario), and where it would likely take years of legal processes, as they automatically deny something like 86% of claims - as insurance companies seem to do, possibly in hopes the person doesn't have money to fight them even on legitimate claims based on their own rules; and at the moment my concentration is still too fucked and my nervous system too sensitive to stress to be able to start organizing for that, aside from the high cost.
In both countries - I can CHOOSE to go private for whatever reasons (for example, one of my friends has just had a baby and she chose to go private so she could get the OBGYN that she wanted and have a planned caesarian).
But it is not necessary and for those who cant afford private healthcare (or those who dont want to take it out) that safety net exists.
The foolproof solution (if such a thing could ever exist) - is to not have a healthcare system that is built for-profit. That way the government is the largest bargainer, you dont have companies colluding to drive up prices, everyone know what they are going to get and can't try and sway it that way.
By it coming from taxes the prices are managed better than if you have a bunch of cough self regulating companies running the racket.
I understand the pros and cons very well - and even with my private healthcare I get the benefits of the service I pay for with my taxes so my bill would never even be 10% of that 800k you somehow have paid.
Well we 100% agree here. The system you describe sounds totally reasonable to me as long as the government is managing things reasonably.
I'd extend this problem to effectively every industry too. Profit is such a corrupting factor in any business and really ruins most things. Free markets, capitalism, whatever I get all of that but creating incentives entirely around winning a zero sum game is terrible for everyone in the long run.
Bingo!
The issue is, especially in Canada, which people don't seem to know is a "free" healthcare system structured fundamentally differently than the other more successful systems.
The primary issues I believe are rigid centralization - along with nepotism, and the single point of failure-capture that is then possible in a highly controlled-centralized system, where the people - the voters - get no say; e.g. when the health system doesn't have elected administrators.
In the US, I believe most states and cities, judges and police captains are elected? In Canada, we don't have that even.
There are pros and cons to "both" systems, and there are solutions to better select for the pros in both.
In Canada, I can't privately pay a doctor for care - their hands are tied; dentists/dental-jaw aren't included - because dental isn't covered - somehow the teeth and jaw, and related tissues, aren't part of the body.
And you're making lots of assumptions - but no point in addressing those, but I'm curious what some of the pros and cons are? More specifically the cons; usually people haven't thought too deep to extrapolate to the consequences of either the pros or cons.
It's quite clear there's a large disconnect between people who likely had relatively simple health issues needing to be diagnosed and treated vs. others with more complex issues; of course the quality-competence of doctors you encounter is going to be the primary fundamental factors - which in part has to do with their training, their environment of if they are around other competent-knowledgable doctors - which then includes their education, how much they excel at memorization rather than critical thinking and observation skills.
I'm also curious if you ever played any rough sports or been in any serious collisions/accidents, or have you never really had any significant or complex injuries?
The pros and cons are the same pros and cons you get with any system that has some form of centralised control.
The main one comes down to triage, if you need / want a procedure that isnt life threatening or helps your quality of life you can expect a long wait or not being able to get it. For example - any kind of cosmetic surgery isnt going to be done for free unless it affects your quality of life (e.g. Rhinoplasty for deviated septum)
If your situation is an emergency you get seen pretty quickly - otherwise it can take a while - as an example my mother needed a knee replacement - it took almost a year from when the doctor recognised the need for her to actually have it done. But it got done and didnt cost a penny.
She could have gone private, had it done the following week and paid 5-6 figures for it - it just wasnt that urgent and she couldnt afford it.
I have played rough sports and been hospitalised from it and I was treated immediately (emergency) - again this was free.
I think this concept is lost on people - not everything medical needs to done immediately and its sometimes fine to wait (even if its not preferred).
There are blind spots regarding problems that you're unaware of since you haven't experienced them.
Glad your and your mother's situations were simple enough for a relatively quick resolution.
I wonder if your mother could have benefit more from a stem cell treatment, but that perhaps only a knee replacement was covered - even if the knee replacement would have cost the system more money overall.
Do you agree to pay for a car with no idea the cost? Then find random bills from people who glanced at the car or might be involved even if you didn't meet them? Well too bad if you want to visit a doctor you have to.
In what world should this this possible? I got a in-network nose examine that I'm happy my insurance paid the $1k+ for the 5 min examine to find out my nose was normal. I didn't realize there was a third party bill though, while it wasn't much imagine if I had some $5k examine or $20k examine, I'd not know the difference until I got the bill because it's America. You'd think since the insurance and hospital are same company this could be easier but no, multiple different payment companies for the different types of bills too. I have to look in multiple areas to check everything is paid for. How much more overly complicated can they make it?
There have to be laws backing up this nonsensical practice of sending arbitrary and inflated post-facto bills, because if anybody else engaged in this sort of thing it would rightly be considered fraud. Such a privilege may have made sense back when the medical industry was more honest and less brazenly extractive, but at this point it's a dynamic they've set up around enthusiastically abusing. One of the main pillars of any type of healthcare reform should be getting rid of such laws, and then AGs going after any company that continues engaging in this type of billing fraud.
1: https://files.consumerfinance.gov/f/201412_cfpb_reports_cons...
I hate when people make terrible financial decisions, like running up cancer treatment bills that they can't afford to pay.
Looking at this strictly from the perspective of creditworthiness, the question isn't the morality of the debt but whether this influences that person's ability to pay their credit card bill on time.
Based on the CFPB's data, if that's the sole delinquency on the report, the answer is a coin flip [1].
[1] https://files.consumerfinance.gov/f/201412_cfpb_reports_cons... page 7
It’s worth remembering that this won’t impact loaners, though; they don’t care as long as everyone has to do it so they aren’t getting undercut on rates.
They’ll just raise interest rates to cover the extra delinquencies, making cars/houses/etc less affordable to the poor. Hopefully by a small amount if the CFPB is right.
Look, medical debt is very different from other kinds of debt in that it is usually incurred suddenly and unwillingly and at ruinous expense. Just using your family medical history would be a better improvement on the model and I've got the feeling that wouldnt strike you as just.
Any of the other times when efforts were made to extend credit to people with bad credit scores, and it ends up with indebted people being in worse debt.
> Not so sure why you're down on doing good
a do-gooder is someone who has a naive conviction of their own moral superiority and agency
I'm saying there's people who, by never doubting their own agency & fallibility, force the unfortunate people they're trying to help into even worse misfortune.
I don't think this is the cure for student loans, though.
The #1 reform student loans need is to be dischargeable through bankruptcy. There's a long list after that.
Credit records doesn't make the list for student loan reform to me. Credit records should be about choices, which student loans are, and which medical expenses are not.
The cliche about $200k debt for a liberal arts degree is perhaps an exaggeration, but the core of student loan reforms should be on realigning incentives to make sure the ROI is positive.
They see a medical professional, the professional makes some recommendation, and then the patient accepts or rejects the recommendation. Neither the medical professional nor the patient know the costs the patient will eventually encounter.
The patient only finds out their costs some months later when they receive one or more bills negotiated between administrative groups and their health insurance provider. Any goods and services have already been rendered, and the patient is now on the hook for whatever the bills happen to see.
Maybe the more "fair" answer is to make medical costs transparent instead of treating medical debt different than other kinds, but the system is broken and needs critical attention either way. This is essentially a path of least resistence.
Medical practices bill an insanely high amount with zero upfront disclosure while demanding every bit of personal information (employers past and present, educational history, SSN, all possible insurers, etc) and are often caught billing people they failed to serve (left after waiting hours) or refused to serve.
The medical insurers aren't any better is the real kicker!
Many medical debts aren't paid off. I've disputed my fair share of them until the hospital agreed in writing to waive the charges. (Never went to collections, granted.)
The first step in each of those cases was refusing to pay.
> if I were to offer them a loan and wasn’t aware that they’re saddled with medical debt, wouldn’t that leave me in a bad position as a lender?
Yes, probably. This rule likely needs a sibling regulation reducing the capacity of collectors to collect on medical debt in ways that financially impair the consumer.
But if we did that, then medical debt would become even less valuable to collectors, and hospitals will struggle to sell off unpaid accounts.
They’d have to make up the difference elsewhere, and raise prices further.
This regulation seems well meaning but it’s just beating around the bush that our healthcare system is way too expensive and there’s no politically feasible solution.
Proper published pricing, for starters. If the price isn’t properly published and price wasn’t agreed upon ex ante, the bill should be dismissible. (It’s technically the law, but compliance is miserable.)
Medical debt is already heavily discounted given its abysmal collection rates. Papering over that by pretending something that trades at pennies is worth face value strikes me as a useless fiction to continue propagating.
> have to make up the difference elsewhere, and raise prices further
Medical debt trades at a nickel to a dime on the dollar [1]. This isn’t a meaningful difference.
[1] https://www.solosuit.com/posts/how-much-collection-agencies-...
I think most people here will probably agree with that (myself included!), but I suspect the disagreement is about whether that's a convincing argument against this policy given the political reality that reforming healthcare as a whole is not feasible at the moment and won't likely be any time soon. Trying to reform healthcare right now would require passing in the Senate (meaning either a supermajority voting for it or the majority party eliminating the filibuster), the House (which currently is not controlled by the same party as the Senate and the White House and unlikely to agree with them on any healthcare laws), signed by the president, upheld by the Supreme Court when it inevitably gets challenged, and then not repealed subsequently by a later presidential administration and Congress.
The part that people disagree with you on isn't whether this proposal is the best possible way to handle the issue of people unfairly having medical debt; it's whether doing nothing until the entire healthcare system gets overhauled would be letting the perfect be the enemy of the good.
Even though this is a serious issue that intimately, negatively affects nearly every American citizen at some point in their life, there is still not enough pressure on the government to enact a real change. Insurance companies simply have more political power than voters do.
This change will mean creditor companies have skin in the game, too, and so hopefully they will now lobby the government to fix the medical problem. It's not fair — it's not their fault that the insurance lobby is out of control — but fairness isn't working.
The way I see it, corporations are manmade tools, not human beings with innate desires and rights. Corporations cannot exist unless a society chooses to legally define incorporation, and societies only do this because corporations are very useful for advanced economies. Thus corporations ultimately exist in service to the society that creates them and grants them the means to participate in said society.
If some corporation get out of control, society should have the right to rope its other corporations into reigning the rogue corporation back in if necessary — because all corporations are ultimately tools that society creates, uses, and dissolves.
Isn't it helpful and important to know that a) how much debt the person is liable for and b) that they're willing to sign a contract allowing someone to charge them any amount to be decided at a later date?
The later seems important both to know that the person may continue to agree to writing blank checks in the future and that their willingness to do so says something about their financial awareness.
B) shouldn't be legal at all though, and that's the real problem. It is a fact that patients agree to owe whatever the hospital says they owe, and in my opinion that should be part of a credit history. Its also a fact, though, that hospitals charging this way is fraud and the system needs to be fundamentally fixed rather than band-aided by trying to just hide how much debt they are creating.
I'm guessing the argument here is that you can't expect someone to have the chance to make a nuanced decision or to turn down care because of the terms a hospital requires you to agree to. That's simply not true. Beyond the obvious, but unreasonable, fact that one doesn't actually have to get treated there if they don't like the terms, it's a contract and contracts have to be agreed to by both parties.
A patient doesn't have to sign intake papers as-is. It's a contract, scratch out what you don't agree to and add your own terms if necessary. Include "Under duress" with your signature and make sure the person at the desk is aware. You aren't trying to be difficult or fight with them, you simply don't agree to some of the contract and are making that legally clear while signing in.
No. You cannot make a nuanced decision when you're in an accident and are rushed (unconsciously) to an out-of-network hospital, or any kind of similar emergency situation. Negotiating a medical contract is not like signing a car lease.
Not sure why this is so difficult to understand? Have you actually been to a hospital, or in any form of even mild pain?
Hilarious to try to blame the US's broken medical system on the victim. If you've ever had any medical procedure done then you've done this thing that you consider so reprehensible. If you've ever been seriously injured you've done this (your consent to any price charged is presumed while you are unconscious, by law). If the hospital walks 5 specialists quickly through the room while you're out cold, congratulations, you legally consented to pay any price they charge.
Come on. It's a ludicrous system. Don't even try to blame the victims here.
If the latter, we totally agree. My view is that the system is fundamentally broken and continuing to just try to help patients deal with fraud after the fact isn't the right solution. In this case, allowing the fraud to continue and only hiding it from credit reports just makes it worse for us as consumers.
We need to stop band-aiding the problem and fix the medical system. They obviously shouldn't be allowed to decide to charge whatever they want after the work is done, and they shouldn't be able to game it by running multiple specialists through just to rack up fees.
There are actually ways around it today, but the hospital will hate you. When signing intake forms that have you agreeing to this payment model, cross out the terms you do to agree to and include "Under Duress" with your signature. Raise this with the hospital staff and make it clear what terms you disagree with, including that you must approve every individual treatment. They won't like you, or they may 100% respect you, but it is legal to do.
"A large portion of consumers with medical debts in collections show no other evidence of financial distress and are consumers who ordinarily pay their other financial obligations on time. 22 percent of consumers with collections tradelines (7 percent of all consumers with credit reports) have only medical collections tradelines. These consumers owe less, have more available credit which they could use to repay their debt, and are more reliable payers than consumers with non-medical collections tradelines or than consumers with both types of collections tradelines. Indeed, of the consumers with only medical collections tradelines, approximately 50 percent have otherwise 'clean' credit reports with no indication of serious past delinquencies" [1].
It thus seems up for debate whether these debts represent the financial health or creditworthiness of the consumer.
> feels like a ban on speech
It's commercial speech regarding a private concern and thereby subject to "intermediate scrutiny" (versus the strict scrutiny afforded to political speech) [2].
[1] https://files.consumerfinance.gov/f/201412_cfpb_reports_cons...
[2] http://www.jtexconsumerlaw.com/V16N2/V16N2_FairCredit.pdf
You’re missing my point, I think (feel free to tell me otherwise). It doesn’t matter that they ordinarily pay their debts and are responsible financially before their medical debt. If they have medical debt that they’re obligated to pay off, then it affects their ability to pay other debts and is therefore something I would want to know as a lender.
> It's commercial speech regarding a private concern and thereby subject to "intermediate scrutiny" (versus the strict scrutiny afforded to political speech)
I have not analyzed the SCOTUS precedent here. But I’m making a more generic claim that this violates free speech (a basic principle more fundamental than US law).
EDIT since I can’t reply deeper in the thread: this speech isn’t fraud so that feels like a false equivalence. It’s just informing others of the facts. That shouldn’t be limited, right?
I'm curious for data on how medical debt affects creditworthiness.
There are limits on collecting medical debt, for example, that might make someone with a massive on-paper medical debt a good credit concern. Medical billing is also notoriously error prone in a way e.g. credit card billing simply is not. That further reduces the information in each medical-debt line item.
> I’m making a more generic claim that this violates free speech (a basic principle more fundamental than US law)
Yes, so does prosecuting someone for fraud. We've been balancing rights for centuries, in law and philosophy, particularly when it comes to commercial speech.
It's not like you have a choice to have life-saving care or not.
1) Insurance is structured to be affordable to everyone by banning discrimination. Young, healthy people subsidize old, sick people. That's okay.
2) No one is banning free speech. People are banning specific types of decision-making based on free speech.
3) Speech here isn't free. See HIPAA. It's okay -- and even important -- to protect privacy. See also FERPA, RFPA, etc.
I don't feel bad having my interest rates a little bit higher right now, in return for not having them go up if I have a horrific medical expense later. I don't think that should be factored.
This is not a debt people choose.
Assuming there is a sufficient proportion of young, healthy people such that an acceptable proportion of the young, healthy people's productivity (income) is used to subsidize old, sick people.
Whether or not it is “acceptable” to the population is not an objective fact, although, there is always quite a bit of grumbling about increasing premiums, and the spending as a proportion of the nation’s productive output can only increased based on the population pyramid.
And I bet that applies to every developed country.
It's not obvious to me whether the proposal is a total ban on any medical related debt or if there's underlying legal details that attempt to condition the debt being excluded on some sort of test of whether the debt was unavoidable or not, but even if there's not, the question is whether excluding all medical debt is more fair than including; at least to me, it seems much more reasonable to punish medical debt at all than punish all of it.