[House Report 116-653]
[From the U.S. Government Publishing Office]
116th Congress } { Report
HOUSE OF REPRESENTATIVES
2d Session } { 116-653
======================================================================
CONSUMER PROTECTION FOR MEDICAL DEBT COLLECTIONS ACT
_______
December 15, 2020.--Committed to the Committee of the Whole House on
the State of the Union and ordered to be printed
_______
Ms. Waters, from the Committee on Financial Services, submitted the
following
R E P O R T
together with
MINORITY VIEWS
[To accompany H.R. 5330]
[Including cost estimate of the Congressional Budget Office]
The Committee on Financial Services, to whom was referred
the bill (H.R. 5330) to amend the Fair Debt Collection
Practices Act to provide a timetable for verification of
medical debt and to increase the efficiency of credit markets
with more perfect information, to prohibit consumer reporting
agencies from issuing consumer reports containing information
about debts related to medically necessary procedure, about and
for other purposes, having considered the same, reports
favorably thereon with amendments and recommends that the bill
as amended do pass.
CONTENTS
Page
Purpose and Summary.............................................. 3
Background and Need for Legislation.............................. 3
Section-by-Section Analysis...................................... 4
Hearings......................................................... 4
Committee Consideration.......................................... 5
Committee Votes.................................................. 5
Statement of Oversight Findings and Recommendations of the
Committee...................................................... 8
Statement of Performance Goals and Objectives.................... 8
New Budget Authority and CBO Cost Estimate....................... 8
Committee Cost Estimate.......................................... 10
Unfunded Mandate Statement....................................... 10
Advisory Committee............................................... 10
Application of Law to the Legislative Branch..................... 10
Earmark Statement................................................ 11
Duplication of Federal Programs.................................. 11
Changes to Existing Law.......................................... 11
The amendments are as follows:
Strike all after the enacting clause and insert the
following:
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Consumer Protection for Medical Debt
Collections Act''.
SEC. 2. AMENDMENTS TO THE FAIR DEBT COLLECTION PRACTICES ACT.
(a) Definition.--Section 803 of the Fair Debt Collection Practices
Act (15 U.S.C. 1692a) is amended by adding at the end the following:
``(9) The term `medical debt' means a debt arising
from the receipt of medical services, products, or
devices.''.
(b) Unfair Practices.--Section 808 of the Fair Debt Collection
Practices Act (15 U.S.C. 1692f) is amended by adding at the end the
following:
``(9) Engaging in activities to collect or attempting
to collect a medical debt owed or due or asserted to be
owed or due by a consumer, before the end of the 2-year
period beginning on the date that the first payment
with respect to such medical debt is due.''.
SEC. 3. PROHIBITION ON CONSUMER REPORTING AGENCIES REPORTING CERTAIN
MEDICAL DEBT.
(a) Definition.--Section 603 of the Fair Credit Reporting Act (15
U.S.C. 1681a) is amended by adding at the end the following:
``(bb) Medical Debt.--The term `medical debt' means a debt arising
from the receipt of medical services, products, or devices.
``(cc) Medically Necessary Procedure.--The term `medically necessary
procedure' means--
``(1) health care services or supplies needed to diagnose or
treat an illness, injury, condition, disease, or its symptoms
and that meet accepted standards of medicine; and
``(2) health care to prevent illness or detect illness at an
early stage, when treatment is likely to work best (including
preventive services such as pap tests, flu shots, and screening
mammograms).''.
(b) In General.--Section 605(a) of the Fair Credit Reporting Act (15
U.S.C. 1681c(a)) is amended by adding at the end the following new
paragraphs:
``(9) Any information related to a debt arising from a
medically necessary procedure.
``(10) Any information related to a medical debt, if the date
on which such debt was placed for collection, charged to profit
or loss, or subjected to any similar action antedates the
report by less than 365 calendar days.''.
SEC. 4. REQUIREMENTS FOR FURNISHERS OF MEDICAL DEBT INFORMATION.
(a) Additional Notice Requirements for Medical Debt.--Section 623 of
the Fair Credit Reporting Act (15 U.S.C. 1681s-2) is amended by adding
at the end the following:
``(f) Additional Notice Requirements for Medical Debt.--Before
furnishing information regarding a medical debt of a consumer to a
consumer reporting agency, the person furnishing the information shall
send a statement to the consumer that includes the following:
``(1) A notification that the medical debt--
``(A) may not be included on a consumer report made
by a consumer reporting agency until the later of the
date that is 365 days after--
``(i) the date on which the person sends the
statement;
``(ii) with respect to the medical debt of a
borrower demonstrating hardship, a date
determined by the Director of the Bureau; or
``(iii) the date described under section
605(a)(10); and
``(B) may not ever be included on a consumer report
made by a consumer reporting agency, if the medical
debt arises from a medically necessary procedure.
``(2) A notification that, if the debt is settled or paid by
the consumer or an insurance company before the end of the
period described under paragraph (1)(A), the debt may not be
reported to a consumer reporting agency.
``(3) A notification that the consumer may--
``(A) communicate with an insurance company to
determine coverage for the debt; or
``(B) apply for financial assistance.''.
(b) Furnishing of Medical Debt Information.--Section 623 of the Fair
Credit Reporting Act (15 U.S.C. 1681s-2), as amended by subsection (a),
is further amended by adding at the end the following:
``(g) Furnishing of Medical Debt Information.--
``(1) Prohibition on reporting debt related to medically
necessary procedures.--No person shall furnish any information
to a consumer reporting agency regarding a debt arising from a
medically necessary procedure.
``(2) Treatment of other medical debt information.--With
respect to a medical debt not described under paragraph (1), no
person shall furnish any information to a consumer reporting
agency regarding such debt before the end of the 365-day period
beginning on the later of--
``(A) the date on which the person sends the
statement described under subsection (f) to the
consumer;
``(B) with respect to the medical debt of a borrower
demonstrating hardship, a date determined by the
Director of the Bureau; or
``(C) the date described in section 605(a)(10).
``(3) Treatment of settled or paid medical debt.--With
respect to a medical debt not described under paragraph (1), no
person shall furnish any information to a consumer reporting
agency regarding such debt if the debt is settled or paid by
the consumer or an insurance company before the end of the 365-
day period described under paragraph (2).
``(4) Borrower demonstrating hardship defined.--In this
subsection, and with respect to a medical debt, the term
`borrower demonstrating hardship' means a borrower or a class
of borrowers who, as determined by the Director of the Bureau,
is facing or has experienced unusual extenuating life
circumstances or events that result in severe financial or
personal barriers such that the borrower or class of borrowers
does not have the capacity to repay the medical debt.''.
SEC. 5. EFFECTIVE DATE.
This Act and the amendments made by this Act shall take effect on the
date that is 180 days after the date of enactment of this Act.
Amend the title so as to read:
A bill to amend the Fair Debt Collection Practices Act to
provide a timetable for the collection of medical debt by debt
collectors, to amend the Fair Credit Reporting Act to prohibit
consumer reporting agencies from issuing consumer reports
containing information about debts related to medically
necessary procedures, and for other purposes.
Purpose and Summary
On December 5, 2019, Congresswoman Rashida Tlaib introduced
H.R. 5330, the ``Consumer Protection for Medical Debt
Collections Act,'' which would bar entities from collecting
medical debt or reporting it to a consumer reporting agency
without giving a consumer notice about their rights under Fair
Debt Collection Practices Act (FDCPA) and Fair Credit Reporting
Act (FCRA) related to that debt, including a minimum one-year
delay before adverse information is reported to a consumer
reporting agency. This legislation outright bans the reporting
of medical debt arising from medically necessary procedures.
Background and Need for Legislation
Debt collectors increasingly contact individuals for their
medical bills than other forms of debt. Fifty-nine percent of
consumers received calls and letters related to collections of
medical debt. The costs of treating illnesses and other medical
conditions can cause consumers to avoid healthcare services and
rely on over-the-counter drugs rather than seeing a medical
provider. Medical bills can be expensive for households, and
the delinquency of payments has led to individuals falling into
bankruptcy and hurting their credit report. The American
Journal of Public Health conducted a survey of 2013-2016
bankruptcy filers and found that 59% of respondents agreed that
medical debt played a role in their bankruptcy.
The Consumer Financial Protection Bureau has also found
that the medical pricing, billing, and reimbursement process
lacks transparency and is prone to consumer confusion, which
can result in consumers delaying or withholding payments until
they have adequate time to clarify or resolve disputes with
their insurance companies or medical service providers about
what they actually owe.
Section-by-Section Analysis
Section 1. Short title
This section provides that H.R. 5330 may be cited as the
``Consumer Protections for Medical Debt Collections Act''.
Section 2. Amendments to the Fair Debt Collection Practices Act
This section amends Section 809 of the Fair Debt Collection
Practices Act.
This section provides a definition for medical debt and
references the statutory definition of a Consumer Reporting
Agency (CRA). This section also requires that the entity
reporting the medical debt of a consumer to a consumer
reporting agency will, prior to reporting the debt, send the
consumer a disclosure that informs the consumer that medical
debt may not be reported to a CRA until the end of the one year
period of the medical debt statement or the last day a consumer
made a payment on the medical debt. The entity must also send a
notification to the consumer that says if the debt is paid or
settled by the consumer or insurance company before the end of
the one year period described above, the debt may not be
reported to a CRA and that the consumer has the right to
contact their insurance agency to determine debt coverage. This
section also bans debt collectors from engaging in activities
to collect or attempt to collect medical debt owed within the
one-year period described above.
Section 3. Prohibition on reporting medically necessary procedures
This section amends section 605(a) of the Fair Credit
Reporting Act.
This section bans an entity from reporting information
related to a debt arising from a medically necessary procedure.
Hearings
For the purposes of section 103(i) of H. Res. 6 for the
116th Congress--
(1) On September 26, 2019, the Committee on Financial
Services held a hearing entitled, ``Examining Legislation to
Protect Consumers and Small Business Owners from Abusive Debt
Collection Practices'' to discuss three bills and seven
discussion drafts. A discussion draft of HR 5330, the
``Examining Legislation to Protect Consumers and Small Business
Owners from Abusive Debt Collection Practices'', was
considered. This single-panel hearing consisted of witnesses
from the Federal Trade Commission, consumer advocates, consumer
law centers, and debt collection attorneys. The hearing allowed
members to hear from witnesses about predatory debt collection
practices and discuss the limitations of the Fair Debt
Collection Practices Act.
(2) The Committee on Financial Services held a hearing,
entitled ``Who's Keeping Score? Holding Credit Bureaus
Accountable and Repairing a Broken System'' to consider the
``Comprehensive Consumer Credit Reporting Reform Act of 2019''
on February 26, 2019. The two-panel hearing consisted of first
the three CEOs of the three largest Credit Reporting Agencies:
Equifax, TransUnion, and Experian. Witnesses on the second
panel included representatives from the National Fair Housing
Alliance, the National Consumer Law Center, UnidosUS, U.S.
Public Interest Research Group (PIRG), and a Paul Hastings
partner and attorney. The hearing allowed Members of the
Financial Services Committee to hear from witnesses about the
continuing challenges modernizing the Fair Credit Reporting Act
to better protect consumers and their data, as well as other
legislation to help overcome those challenges.
Committee Consideration
The Committee on Financial Services met in open session on
December 11, 2019 and ordered H.R. 5330 to be reported
favorably to the House as amended in the nature of a substitute
by a recorded vote of 31 yeas and 24 neas, a quorum being
present.
Committee Votes and Roll Call Votes
In compliance with clause 3(b) of rule XIII of the Rules of
the House of Representatives, the Committee advises that the
following roll call votes occurred during the Committee's
consideration of H.R. 5330:
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
Statement of Oversight Findings and Recommendations of the Committee
In compliance with clause 3(c)(1) of rule XIII and clause
2(b)(1) of rule X of the Rules of the House of Representatives,
the Committee's oversight findings and recommendations are
reflected in the descriptive portions of this report.
Statement of Performance Goals and Objectives
Pursuant to clause (3)(c) of rule XIII of the Rules of the
House of Representatives, the goals of H.R. 5330 are to ensure
consumers suffering from medical emergencies or conditions have
an opportunity to repay that debt before it negatively impacts
their credit scores and access to credit.
New Budget Authority and CBO Cost Estimate
Pursuant to clause 3(c)(2) of rule XIII of the Rules of the
House of Representatives and section 308(a) of the
Congressional Budget Act of 1974, and pursuant to clause
3(c)(3) of rule XIII of the Rules of the House of
Representatives and section 402 of the Congressional Budget Act
of 1974, the Committee has received the following estimate for
H.R. 5330 from the Director of the Congressional Budget Office:
U.S. Congress,
Congressional Budget Office,
Washington, DC.
Hon. Maxine Waters,
Chairwoman, Committee on Financial Services,
House of Representatives, Washington, DC.
Dear Madam Chairwoman: The Congressional Budget Office has
prepared the enclosed cost estimate for H.R. 5330, the Consumer
Protection for Medical Debt Collections Act.
If you wish further details on this estimate, we will be
pleased to provide them. The CBO staff contact is David Hughes.
Sincerely,
Phillip L. Swagel,
Director.
Enclosure.
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
H.R. 5330 would amend the Fair Debt Collection Practices
Act (FDCPA) to require debt collectors to wait at least two
years after the first payment of a medical debt is due before
engaging in activities to collect that debt. Under the bill,
consumer reporting agencies (CRAs) would be prohibited from
assembling consumer reports that contain information about a
medical debt arising from a medically necessary procedure or a
medical debt placed for collection less than one year preceding
the report's creation. The bill would place similar
prohibitions upon entities that furnish information about
medical debt to CRAs.
The Federal Trade Commission (FTC) is primarily responsible
for enforcing violations of the FDCPA. Using information from
the FTC, CBO estimates that it would cost the FTC less than
$500,000 over the 2021-2025 period to enforce potential
violations of the amended statute. Any spending would be
subject to the availability of appropriated funds.
The Consumer Financial Protection Bureau (CFPB) is
responsible for issuing regulations to implement the FDCPA.
Using information from the CFPB, CBO estimates that the bureau
would require three employees at a cost of $220,000 per
employee to issue rules prohibiting debt collectors and CRAs
from engaging in the newly restricted activities under the
bill. On that basis, CBO estimates that enacting H.R. 5330
would cost the CFPB $1 million over the 2021-2030 period. The
CFPB has permanent authority, not subject to annual
appropriation, to spend amounts transferred from the Federal
Reserve.
The bill would impose intergovernmental and private-sector
mandates, as defined in the Unfunded Mandates Reform Act
(UMRA). CBO estimates the cost to comply with private-sector
mandates would exceed the threshold established in UMRA ($168
million in 2020, adjusted annually for inflation). However, the
cost to comply with the intergovernmental mandates would not
exceed the threshold established in UMRA ($84 million in 2020,
adjusted annually for inflation).
The bill would prohibit debt collectors from collecting
amounts owed for medical debt for at least two years after the
first payment on that debt is due. Using information from
industry sources, the CFPB, and an analysis of state laws
governing the statute of limitations for medical debt, CBO
estimates that the cost of the mandate, in the form of foregone
and delayed collections by debt collectors, would be
substantially over the threshold.
H.R. 5530 also would prohibit CRAs from issuing consumer
reports containing information on debts for medically necessary
procedures and medical debt that has been in collections for
less than a year. CBO estimates that the cost for CRAs to
comply with the prohibitions would be small.
The FDCPA preempts state laws that conflict with its
provisions and any amendments that would broaden its scope
would be an intergovernmental mandate as defined in UMRA. H.R.
5330 would expand the FDCPA to include certain medical debt
collections. Although the bill would limit the application of
state laws, it would impose no duty on states that would result
in additional spending or loss of revenue. Consequently, the
cost would not exceed the threshold established in the UMRA for
intergovernmental mandates.
The CBO staff contacts for this estimate are David Hughes
(for federal costs) and Rachel Austin (for mandates). The
estimate was reviewed by H. Samuel Papenfuss, Deputy Assistant
Director for Budget Analysis.
Committee Cost Estimate
Clause 3(d)(1) of rule XIII of the Rules of the House of
Representatives requires an estimate and a comparison of the
costs that would be incurred in carrying out H.R. 5330.
However, clause 3(d)(2)(B) of that rule provides that this
requirement does not apply when the committee has included in
its report a timely submitted cost estimate of the bill
prepared by the Director of the Congressional Budget Office
under section 402 of the Congressional Budget Act, which is
attached.
Unfunded Mandate Statement
Pursuant to Section 423 of the Congressional Budget and
Impoundment Control Act (as amended The Committee adopts as its
own the estimate of federal mandates regarding H.R. 5330, as
amended, prepared by the Director of the Congressional Budget
Office.
Advisory Committee
No advisory committees within the meaning of section 5(b)
of the Federal Advisory Committee Act were created by this
legislation.
Application of Law to the Legislative Branch
Pursuant to section 102(b)(3) of the Congressional
Accountability Act, Pub. L. No. 104-1 H.R. 5330, as amended,
does not apply to terms and conditions of employment or to
access to public services or accommodations within the
legislative branch.
Earmark Statement
In accordance with clause 9 of rule XXI of the Rules of the
House of Representatives, H.R. 5330 does not contain any
congressional earmarks, limited tax benefits, or limited tariff
benefits as described in clauses 9(e), 9(f), and 9(g) of rule
XXI.
Duplication of Federal Programs
Pursuant to clause 3(c)(5) of rule XIII of the Rules of the
House of Representatives, the Committee states that no
provision of H.R. 5330 establishes or reauthorizes a program of
the Federal Government known to be duplicative of another
federal program, a program that was included in any report from
the Government Accountability Office to Congress pursuant to
section 21 of Public Law 111-139, or a program related to a
program identified in the most recent Catalog of Federal
Domestic Assistance.
Changes to Existing Law
In compliance with clause 3(e) of rule XIII of the Rules of
the House of Representatives, changes in existing law made by
the bill, H.R. 5330, as reported, are shown as follows:
Changes in Existing Law Made by the Bill, as Reported
In compliance with clause 3(e) of rule XIII of the Rules of
the House of Representatives, changes in existing law made by
the bill, as reported, are shown as follows (new matter is
printed in italics and existing law in which no change is
proposed is shown in roman):
FAIR DEBT COLLECTION PRACTICES ACT
TITLE VIII--DEBT COLLECTION PRACTICES
* * * * * * *
Sec. 803. Definitions
As used in this title--
(1) The term ``Bureau'' means the Bureau of Consumer
Financial Protection.
(2) The term ``communication'' means the conveying of
information regarding a debt directly or indirectly to
any person through any medium.
(3) The term ``consumer'' means any natural person
obligated or allegedly obligated to pay any debt.
(4) The term ``creditor'' means any person who offers
or extends credit creating a debt or to whom a debt is
owed, but such term does not include any person to the
extent that he receives an assignment or transfer of a
debt in default solely for the purpose of facilitating
collection of such debt for another.
(5) The term ``debt'' means any obligation or alleged
obligation of a consumer to pay money arising out of a
transaction in which the money, property, insurance, or
services which are the subject of the transaction are
primarily for personal, family, or household purposes,
whether or not such obligation has been reduced to
judgment.
(6) The term ``debt collector'' means any person who
uses any instrumentality of interstate commerce or the
mails in any business the principal purpose of which is
the collection of any debts, or who regularly collects
or attempts to collect, directly or indirectly, debts
owed or due or asserted to be owed or due another.
Notwithstanding the exclusion provided by clause (F) of
the last sentence of this paragraph, the term includes
any creditor who, in the process of collecting his own
debts, uses any name other than his own which would
indicate that a third person is collecting or
attempting to collect such debts. For the purpose of
section 808(6), such term also includes any person who
uses any instrumentality of interstate commerce or the
mails in any business the principal purpose of which is
the enforcement of security interests. The term does
not include--
(A) any officer or employee of a creditor
while, in the name of the creditor, collecting
debts for such creditor;
(B) any person while acting as a debt
collector for another person, both of whom are
related by common ownership or affiliated by
corporate control, if the person acting as a
debt collector does so only for persons to whom
it is so related or affilated and if the
principal business of such person is not the
collection of debts;
(C) any officer or employee of the United
States or any State to the extent that
collecting or attempting to collect any debt is
in the performance of his official duties;
(D) any person while serving or attempting to
serve legal process on any other person in
connection with the judicial enforcement of any
debt;
(E) any nonprofit organization which, at the
request of consumers, performs bona fide
consumer credit counseling and assists
consumers in the liquidation of their debts by
receiving payments from such consumers and
distributing such amounts to creditors;
(F) any person collecting or attempting to
collect any debt owed or due or asserted to be
owed or due another to the extent such activity
(i) is incidental to a bona fide fiduciary
obligation or a bona fide escrow arrangement;
(ii) concerns a debt which was originated by
such person; (iii) concerns a debt which was
not in default at the time it was obtained by
such person; or (iv) concerns a debt obtained
by such person as a secured party in a
commercial credit transaction involving the
creditor.
(7) The term ``location information'' means a
consumer's place of abode and his telephone number at
such place, or his place of employment.
(8) The term ``State'' means any State, territory, or
possession of the United States, the District of
Columbia, the Commonwealth of Puerto Rico, or any
political subdivision of any of the foregoing.
(9) The term ``medical debt'' means a debt arising
from the receipt of medical services, products, or
devices.
* * * * * * *
Sec. 808. Unfair practices
A debt collector may not use unfair or unconscionable means
to collect or attempt to collect any debt. Without limiting the
general application of the foregoing, the following conduct is
a violation of this section:
(1) The collection of any amount (including any
interest, fee, charge, or expense incidental to the
principal obligation) unless such amount is expressly
authorized by the agreement creating the debt or
permitted by law.
(2) The acceptance by a debt collector from any
person of a check or other payment instrument postdated
by more than five days unless such person is notified
in writing of the debt collector's intent to deposit
such check or instrument not more than ten nor less
than three business days prior to such deposit.
(3) The solicitation by a debt collector of any
postdated check or other postdated payment instrument
for the purpose of threatening or instituting criminal
prosecution.
(4) Depositing or threatening to deposit any
postdated check or other postdated payment instrument
prior to the date on such check or instrument.
(5) Causing charges to be made to any person for
communications by concealment of the true purpose of
the communication. Such charges include, but are not
limited to, collect telephone calls and telegram fees.
(6) Taking or threatening to take any nonjudicial
action to effect dispossession or disablement of
property if--
(A) there is no present right to possession
of the property claimed as collateral through
an enforceable security interest;
(B) there is no present intention to take
possession of the property; or
(C) the property is exempt by law from such
dispossession or disablement.
(7) Communicating with a consumer regarding a debt by
post card.
(8) Using any language or symbol, other than the debt
collector's address, on any envelope when communicating
with a consumer by use of the mails or by telegram,
except that a debt collector may use his business name
if such name does not indicate that he is in the debt
collection business.
(9) Engaging in activities to collect or attempting
to collect a medical debt owed or due or asserted to be
owed or due by a consumer, before the end of the 2-year
period beginning on the date that the first payment
with respect to such medical debt is due.
* * * * * * *
----------
FAIR CREDIT REPORTING ACT
TITLE VI--CONSUMER CREDIT REPORTING
* * * * * * *
Sec. 603. Definitions and rules of construction
(a) Definitions and rules of construction set forth in this
section are applicable for the purposes of this title.
(b) The term ``person'' means any individual, partnership,
corporation, trust, estate, cooperative, association,
government or governmental subdivision or agency, or other
entity.
(c) The term ``consumer'' means an individual.
(d) Consumer Report.--
(1) In general.--The term ``consumer report'' means
any written, oral, or other communication of any
information by a consumer reporting agency bearing on a
consumer's credit worthiness, credit standing, credit
capacity, character, general reputation, personal
characteristics, or mode of living which is used or
expected to be used or collected in whole or in part
for the purpose of serving as a factor in establishing
the consumer's eligibility for--
(A) credit or insurance to be used primarily
for personal, family, or household purposes;
(B) employment purposes; or
(C) any other purpose authorized under
section 604.
(2) Exclusions.--Except as provided in paragraph (3),
the term ``consumer report'' does not include--
(A) subject to section 624, any--
(i) report containing information
solely as to transactions or
experiences between the consumer and
the person making the report;
(ii) communication of that
information among persons related by
common ownership or affiliated by
corporate control; or
(iii) communication of other
information among persons related by
common ownership or affiliated by
corporate control, if it is clearly and
conspicuously disclosed to the consumer
that the information may be
communicated among such persons and the
consumer is given the opportunity,
before the time that the information is
initially communicated, to direct that
such information not be communicated
among such persons;
(B) any authorization or approval of a
specific extension of credit directly or
indirectly by the issuer of a credit card or
similar device;
(C) any report in which a person who has been
requested by a third party to make a specific
extension of credit directly or indirectly to a
consumer conveys his or her decision with
respect to such request, if the third party
advises the consumer of the name and address of
the person to whom the request was made, and
such person makes the disclosures to the
consumer required under section 615; or
(D) a communication described in subsection
(o) or (x).
(3) Restriction on sharing of medical information.--
Except for information or any communication of
information disclosed as provided in section 604(g)(3),
the exclusions in paragraph (2) shall not apply with
respect to information disclosed to any person related
by common ownership or affiliated by corporate control,
if the information is--
(A) medical information;
(B) an individualized list or description
based on the payment transactions of the
consumer for medical products or services; or
(C) an aggregate list of identified consumers
based on payment transactions for medical
products or services.
(e) The term ``investigative consumer report'' means a
consumer report or portion thereof in which information on a
consumer's character, general reputation, personal
characteristics, or mode of living is obtained through personal
interviews with neighbors, friends, or associates of the
consumer reported on or with others with whom he is acquainted
or who may have knowledge concerning any such items of
information. However, such information shall not include
specific factual information on a consumer's credit record
obtained directly from a creditor of the consumer or from a
consumer reporting agency when such information was obtained
directly from a creditor of the consumer or from the consumer.
(f) The term ``consumer reporting agency'' means any person
which, for monetary fees, dues, or on a cooperative nonprofit
basis, regularly engages in whole or in part in the practice of
assembling or evaluating consumer credit information or other
information on consumers for the purpose of furnishing consumer
reports to third parties, and which uses any means or facility
of interstate commerce for the purpose of preparing or
furnishing consumer reports.
(g) The term ``file'', when used in connection with
information on any consumer, means all of the information on
that consumer recorded and retained by a consumer reporting
agency regardless of how the information is stored.
(h) The term ``employment purposes'' when used in connection
with a consumer report means a report used for the purpose of
evaluating a consumer for employment, promotion, reassignment
or retention as an employee.
(i) Medical Information.--The term ``medical information''--
(1) means information or data, whether oral or
recorded, in any form or medium, created by or derived
from a health care provider or the consumer, that
relates to--
(A) the past, present, or future physical,
mental, or behavioral health or condition of an
individual;
(B) the provision of health care to an
individual; or
(C) the payment for the provision of health
care to an individual.
(2) does not include the age or gender of a consumer,
demographic information about the consumer, including a
consumer's residence address or e-mail address, or any
other information about a consumer that does not relate
to the physical, mental, or behavioral health or
condition of a consumer, including the existence or
value of any insurance policy.
(j) Definitions Relating to Child Support Obligations.--
(1) Overdue support.--The term ``overdue support''
has the meaning given to such term in section 466(e) of
the Social Security Act.
(2) State or local child support enforcement
agency.--The term ``State or local child support
enforcement agency'' means a State or local agency
which administers a State or local program for
establishing and enforcing child support obligations.
(k) Adverse Action.--
(1) Actions included.--The term ``adverse action''--
(A) has the same meaning as in section
701(d)(6) of the Equal Credit Opportunity Act;
and
(B) means--
(i) a denial or cancellation of, an
increase in any charge for, or a
reduction or other adverse or
unfavorable change in the terms of
coverage or amount of, any insurance,
existing or applied for, in connection
with the underwriting of insurance;
(ii) a denial of employment or any
other decision for employment purposes
that adversely affects any current or
prospective employee;
(iii) a denial or cancellation of, an
increase in any charge for, or any
other adverse or unfavorable change in
the terms of, any license or benefit
described in section 604(a)(3)(D); and
(iv) an action taken or determination
that is--
(I) made in connection with
an application that was made
by, or a transaction that was
initiated by, any consumer, or
in connection with a review of
an account under section
604(a)(3)(F)(ii); and
(II) adverse to the interests
of the consumer.
(2) Applicable findings, decisions, commentary, and
orders.--For purposes of any determination of whether
an action is an adverse action under paragraph (1)(A),
all appropriate final findings, decisions, commentary,
and orders issued under section 701(d)(6) of the Equal
Credit Opportunity Act by the Bureau or any court shall
apply.
(l) Firm Offer of Credit or Insurance.--The term ``firm offer
of credit or insurance'' means any offer of credit or insurance
to a consumer that will be honored if the consumer is
determined, based on information in a consumer report on the
consumer, to meet the specific criteria used to select the
consumer for the offer, except that the offer may be further
conditioned on one or more of the following:
(1) The consumer being determined, based on
information in the consumer's application for the
credit or insurance, to meet specific criteria bearing
on credit worthiness or insurability, as applicable,
that are established--
(A) before selection of the consumer for the
offer; and
(B) for the purpose of determining whether to
extend credit or insurance pursuant to the
offer.
(2) Verification--
(A) that the consumer continues to meet the
specific criteria used to select the consumer
for the offer, by using information in a
consumer report on the consumer, information in
the consumer's application for the credit or
insurance, or other information bearing on the
credit worthiness or insurability of the
consumer; or
(B) of the information in the consumer's
application for the credit or insurance, to
determine that the consumer meets the specific
criteria bearing on credit worthiness or
insurability.
(3) The consumer furnishing any collateral that is a
requirement for the extension of the credit or
insurance that was--
(A) established before selection of the
consumer for the offer of credit or insurance;
and
(B) disclosed to the consumer in the offer of
credit or insurance.
(m) Credit or Insurance Transaction That Is Not Initiated by
the Consumer.--The term ``credit or insurance transaction that
is not initiated by the consumer'' does not include the use of
a consumer report by a person with which the consumer has an
account or insurance policy, for purposes of--
(1) reviewing the account or insurance policy; or
(2) collecting the account.
(n) State.--The term ``State'' means any State, the
Commonwealth of Puerto Rico, the District of Columbia, and any
territory or possession of the United States.
(o) Excluded Communications.--A communication is described in
this subsection if it is a communication--
(1) that, but for subsection (d)(2)(D), would be an
investigative consumer report;
(2) that is made to a prospective employer for the
purpose of--
(A) procuring an employee for the employer;
or
(B) procuring an opportunity for a natural
person to work for the employer;
(3) that is made by a person who regularly performs
such procurement;
(4) that is not used by any person for any purpose
other than a purpose described in subparagraph (A) or
(B) of paragraph (2); and
(5) with respect to which--
(A) the consumer who is the subject of the
communication--
(i) consents orally or in writing to
the nature and scope of the
communication, before the collection of
any information for the purpose of
making the communication;
(ii) consents orally or in writing to
the making of the communication to a
prospective employer, before the making
of the communication; and
(iii) in the case of consent under
clause (i) or (ii) given orally, is
provided written confirmation of that
consent by the person making the
communication, not later than 3
business days after the receipt of the
consent by that person;
(B) the person who makes the communication
does not, for the purpose of making the
communication, make any inquiry that if made by
a prospective employer of the consumer who is
the subject of the communication would violate
any applicable Federal or State equal
employment opportunity law or regulation; and
(C) the person who makes the communication--
(i) discloses in writing to the
consumer who is the subject of the
communication, not later than 5
business days after receiving any
request from the consumer for such
disclosure, the nature and substance of
all information in the consumer's file
at the time of the request, except that
the sources of any information that is
acquired solely for use in making the
communication and is actually used for
no other purpose, need not be disclosed
other than under appropriate discovery
procedures in any court of competent
jurisdiction in which an action is
brought; and
(ii) notifies the consumer who is the
subject of the communication, in
writing, of the consumer's right to
request the information described in
clause (i).
(p) Consumer Reporting Agency That Compiles and Maintains
Files on Consumers on a Nationwide Basis.--The term ``consumer
reporting agency that compiles and maintains files on consumers
on a nationwide basis'' means a consumer reporting agency that
regularly engages in the practice of assembling or evaluating,
and maintaining, for the purpose of furnishing consumer reports
to third parties bearing on a consumer's credit worthiness,
credit standing, or credit capacity, each of the following
regarding consumers residing nationwide:
(1) Public record information.
(2) Credit account information from persons who
furnish that information regularly and in the ordinary
course of business.
(q) Definitions Relating to Fraud Alerts.--
(1) Active duty military consumer.--The term ``active
duty military consumer'' means a consumer in military
service who--
(A) is on active duty (as defined in section
101(d)(1) of title 10, United States Code) or
is a reservist performing duty under a call or
order to active duty under a provision of law
referred to in section 101(a)(13) of title 10,
United States Code; and
(B) is assigned to service away from the
usual duty station of the consumer.
(2) Fraud alert; active duty alert.--The terms
``fraud alert'' and ``active duty alert'' mean a
statement in the file of a consumer that--
(A) notifies all prospective users of a
consumer report relating to the consumer that
the consumer may be a victim of fraud,
including identity theft, or is an active duty
military consumer, as applicable; and
(B) is presented in a manner that facilitates
a clear and conspicuous view of the statement
described in subparagraph (A) by any person
requesting such consumer report.
(3) Identity theft.--The term ``identity theft''
means a fraud committed using the identifying
information of another person, subject to such further
definition as the Bureau may prescribe, by regulation.
(4) Identity theft report.--The term ``identity theft
report'' has the meaning given that term by rule of the
Bureau, and means, at a minimum, a report--
(A) that alleges an identity theft;
(B) that is a copy of an official, valid
report filed by a consumer with an appropriate
Federal, State, or local law enforcement
agency, including the United States Postal
Inspection Service, or such other government
agency deemed appropriate by the Bureau; and
(C) the filing of which subjects the person
filing the report to criminal penalties
relating to the filing of false information if,
in fact, the information in the report is
false.
(5) New credit plan.--The term ``new credit plan''
means a new account under an open end credit plan (as
defined in section 103(i) of the Truth in Lending Act)
or a new credit transaction not under an open end
credit plan.
(r) Credit and Debit Related Terms--
(1) Card issuer.--The term ``card issuer'' means--
(A) a credit card issuer, in the case of a
credit card; and
(B) a debit card issuer, in the case of a
debit card.
(2) Credit card.--The term ``credit card'' has the
same meaning as in section 103 of the Truth in Lending
Act.
(3) Debit card.--The term ``debit card'' means any
card issued by a financial institution to a consumer
for use in initiating an electronic fund transfer from
the account of the consumer at such financial
institution, for the purpose of transferring money
between accounts or obtaining money, property, labor,
or services.
(4) Account and electronic fund transfer.--The terms
``account'' and ``electronic fund transfer'' have the
same meanings as in section 903 of the Electronic Fund
Transfer Act.
(5) Credit and creditor.--The terms ``credit'' and
``creditor'' have the same meanings as in section 702
of the Equal Credit Opportunity Act.
(s) Federal Banking Agency.--The term ``Federal banking
agency'' has the same meaning as in section 3 of the Federal
Deposit Insurance Act.
(t) Financial Institution.--The term ``financial
institution'' means a State or National bank, a State or
Federal savings and loan association, a mutual savings bank, a
State or Federal credit union, or any other person that,
directly or indirectly, holds a transaction account (as defined
in section 19(b) of the Federal Reserve Act) belonging to a
consumer.
(u) Reseller.--The term ``reseller'' means a consumer
reporting agency that--
(1) assembles and merges information contained in the
database of another consumer reporting agency or
multiple consumer reporting agencies concerning any
consumer for purposes of furnishing such information to
any third party, to the extent of such activities; and
(2) does not maintain a database of the assembled or
merged information from which new consumer reports are
produced.
(v) Commission.--The term ``Commission'' means the Bureau.
(w) The term ``Bureau'' means the Bureau of Consumer
Financial Protection.
(x) Nationwide Specialty Consumer Reporting Agency.--The term
``nationwide specialty consumer reporting agency'' means a
consumer reporting agency that compiles and maintains files on
consumers on a nationwide basis relating to--
(1) medical records or payments;
(2) residential or tenant history;
(3) check writing history;
(4) employment history; or
(5) insurance claims.
(y) Exclusion of Certain Communications for Employee
Investigations.--
(1) Communications described in this subsection.--A
communication is described in this subsection if--
(A) but for subsection (d)(2)(D), the
communication would be a consumer report;
(B) the communication is made to an employer
in connection with an investigation of--
(i) suspected misconduct relating to
employment; or
(ii) compliance with Federal, State,
or local laws and regulations, the
rules of a self-regulatory
organization, or any preexisting
written policies of the employer;
(C) the communication is not made for the
purpose of investigating a consumer's credit
worthiness, credit standing, or credit
capacity; and
(D) the communication is not provided to any
person except--
(i) to the employer or an agent of
the employer;
(ii) to any Federal or State officer,
agency, or department, or any officer,
agency, or department of a unit of
general local government;
(iii) to any self-regulatory
organization with regulatory authority
over the activities of the employer or
employee;
(iv) as otherwise required by law; or
(v) pursuant to section 608.
(2) Subsequent disclosure.--After taking any adverse
action based in whole or in part on a communication
described in paragraph (1), the employer shall disclose
to the consumer a summary containing the nature and
substance of the communication upon which the adverse
action is based, except that the sources of information
acquired solely for use in preparing what would be but
for subsection (d)(2)(D) an investigative consumer
report need not be disclosed.
(3) Self-regulatory organization defined.--For
purposes of this subsection, the term ``self-regulatory
organization'' includes any self-regulatory
organization (as defined in section 3(a)(26) of the
Securities Exchange Act of 1934), any entity
established under title I of the Sarbanes-Oxley Act of
2002, any board of trade designated by the Commodity
Futures Trading Commission, and any futures association
registered with such Commission.
(z) Veteran.--The term ``veteran'' has the meaning given the
term in section 101 of title 38, United States Code.
(aa) Veteran's Medical Debt.--The term ``veteran's medical
debt''--
(1) means a medical collection debt of a veteran owed
to a non-Department of Veterans Affairs health care
provider that was submitted to the Department for
payment for health care authorized by the Department of
Veterans Affairs; and
(2) includes medical collection debt that the
Department of Veterans Affairs has wrongfully charged a
veteran.
(bb) Medical Debt.--The term ``medical debt'' means a debt
arising from the receipt of medical services, products, or
devices.
(cc) Medically Necessary Procedure.--The term ``medically
necessary procedure'' means--
(1) health care services or supplies needed to
diagnose or treat an illness, injury, condition,
disease, or its symptoms and that meet accepted
standards of medicine; and
(2) health care to prevent illness or detect illness
at an early stage, when treatment is likely to work
best (including preventive services such as pap tests,
flu shots, and screening mammograms).
* * * * * * *
Sec. 605. Requirements relating to information contained in consumer
reports
(a) Information Excluded From Consumer Reports.--Except as
authorized under subsection (b), no consumer reporting agency
may make any consumer report containing any of the following
items of information:
(1) Cases under title 11 of the United States Code or under
the Bankruptcy Act that, from the date of entry of the order
for relief or the date of adjudication, as the case may be,
antedate the report by more than 10 years.
(2) Civil suits, civil judgments, and records of arrest that,
from date of entry, antedate the report by more than seven
years or until the governing statute of limitations has
expired, whichever is the longer period.
(3) Paid tax liens which, from date of payment, antedate the
report by more than seven years.
(4) Accounts placed for collection or charged to profit and
loss which antedate the report by more than seven years.
(5) Any other adverse item of information, other than records
of convictions of crimes which antedates the report by more
than seven years.
(6) The name, address, and telephone number of any
medical information furnisher that has notified the
agency of its status, unless--
(A) such name, address, and telephone number
are restricted or reported using codes that do
not identify, or provide information sufficient
to infer, the specific provider or the nature
of such services, products, or devices to a
person other than the consumer; or
(B) the report is being provided to an
insurance company for a purpose relating to
engaging in the business of insurance other
than property and casualty insurance.
(7) With respect to a consumer reporting agency
described in section 603(p), any information related to
a veteran's medical debt if the date on which the
hospital care, medical services, or extended care
services was rendered relating to the debt antedates
the report by less than 1 year if the consumer
reporting agency has actual knowledge that the
information is related to a veteran's medical debt and
the consumer reporting agency is in compliance with its
obligation under section 302(c)(5) of the Economic
Growth, Regulatory Relief, and Consumer Protection Act.
(8) With respect to a consumer reporting agency
described in section 603(p), any information related to
a fully paid or settled veteran's medical debt that had
been characterized as delinquent, charged off, or in
collection if the consumer reporting agency has actual
knowledge that the information is related to a
veteran's medical debt and the consumer reporting
agency is in compliance with its obligation under
section 302(c)(5) of the Economic Growth, Regulatory
Relief, and Consumer Protection Act.
(9) Any information related to a debt arising from a
medically necessary procedure.
(10) Any information related to a medical debt, if
the date on which such debt was placed for collection,
charged to profit or loss, or subjected to any similar
action antedates the report by less than 365 calendar
days.
(b) The provisions of paragraphs (1) through (5) of
subsection (a) are not applicable in the case of any consumer
credit report to be used in connection with--
(1) a credit transaction involving, or which may
reasonably be expected to involve, a principal amount
of $150,000 or more;
(2) the underwriting of life insurance involving, or
which may reasonably be expected to involve, a face
amount of $150,000 or more; or
(3) the employment of any individual at an annual
salary which equals, or which may reasonably be
expected to equal $75,000, or more.
(c) Running of Reporting Period.--
(1) In general.--The 7-year period referred to in
paragraphs (4) and (6) of subsection (a) shall begin,
with respect to any delinquent account that is placed
for collection (internally or by referral to a third
party, whichever is earlier), charged to profit and
loss, or subjected to any similar action, upon the
expiration of the 180-day period beginning on the date
of the commencement of the delinquency which
immediately preceded the collection activity, charge to
profit and loss, or similar action.
(2) Effective date.--Paragraph (1) shall apply only
to items of information added to the file of a consumer
on or after the date that is 455 days after the date of
enactment of the Consumer Credit Reporting Reform Act
of 1996.
(d) Information Required To Be Disclosed.--
(1) Title 11 information.--Any consumer reporting
agency that furnishes a consumer report that contains
information regarding any case involving the consumer
that arises under title 11, United States Code, shall
include in the report an identification of the chapter
of such title 11 under which such case arises if
provided by the source of the information. If any case
arising or filed under title 11, United States Code, is
withdrawn by the consumer before a final judgment, the
consumer reporting agency shall include in the report
that such case or filing was withdrawn upon receipt of
documentation certifying such withdrawal.
(2) Key factor in credit score information.--Any
consumer reporting agency that furnishes a consumer
report that contains any credit score or any other risk
score or predictor on any consumer shall include in the
report a clear and conspicuous statement that a key
factor (as defined in section 609(f)(2)(B)) that
adversely affected such score or predictor was the
number of enquiries, if such a predictor was in fact a
key factor that adversely affected such score. This
paragraph shall not apply to a check services company,
acting as such, which issues authorizations for the
purpose of approving or processing negotiable
instruments, electronic fund transfers, or similar
methods of payments, but only to the extent that such
company is engaged in such activities.
(e) Indication of Closure of Account by Consumer.--If a
consumer reporting agency is notified pursuant to section
623(a)(4) that a credit account of a consumer was voluntarily
closed by the consumer, the agency shall indicate that fact in
any consumer report that includes information related to the
account.
(f) Indication of Dispute by Consumer.--If a consumer
reporting agency is notified pursuant to section 623(a)(3) that
information regarding a consumer who was furnished to the
agency is disputed by the consumer, the agency shall indicate
that fact in each consumer report that includes the disputed
information.
(g) Truncation of Credit Card and Debit Card Numbers.--
(1) In general.--Except as otherwise provided in this
subsection, no person that accepts credit cards or
debit cards for the transaction of business shall print
more than the last 5 digits of the card number or the
expiration date upon any receipt provided to the
cardholder at the point of the sale or transaction.
(2) Limitation.--This subsection shall apply only to
receipts that are electronically printed, and shall not
apply to transactions in which the sole means of
recording a credit card or debit card account number is
by handwriting or by an imprint or copy of the card.
(3) Effective date.--This subsection shall become
effective--
(A) 3 years after the date of enactment of
this subsection, with respect to any cash
register or other machine or device that
electronically prints receipts for credit card
or debit card transactions that is in use
before January 1, 2005; and
(B) 1 year after the date of enactment of
this subsection, with respect to any cash
register or other machine or device that
electronically prints receipts for credit card
or debit card transactions that is first put
into use on or after January 1, 2005.
(h) Notice of Discrepancy in Address.--
(1) In general.--If a person has requested a consumer
report relating to a consumer from a consumer reporting
agency described in section 603(p), the request
includes an address for the consumer that substantially
differs from the addresses in the file of the consumer,
and the agency provides a consumer report in response
to the request, the consumer reporting agency shall
notify the requester of the existence of the
discrepancy.
(2) Regulations.--
(A) Regulations required.--The Bureau shall,,
in consultation with the Federal banking
agencies, the National Credit Union
Administration, and the Federal Trade
Commission,, prescribe regulations providing
guidance regarding reasonable policies and
procedures that a user of a consumer report
should employ when such user has received a
notice of discrepancy under paragraph (1).
(B) Policies and procedures to be included.--
The regulations prescribed under subparagraph
(A) shall describe reasonable policies and
procedures for use by a user of a consumer
report--
(i) to form a reasonable belief that
the user knows the identity of the
person to whom the consumer report
pertains; and
(ii) if the user establishes a
continuing relationship with the
consumer, and the user regularly and in
the ordinary course of business
furnishes information to the consumer
reporting agency from which the notice
of discrepancy pertaining to the
consumer was obtained, to reconcile the
address of the consumer with the
consumer reporting agency by furnishing
such address to such consumer reporting
agency as part of information regularly
furnished by the user for the period in
which the relationship is established.
* * * * * * *
SEC. 623. RESPONSIBILITIES OF FURNISHERS OF INFORMATION TO CONSUMER
REPORTING AGENCIES.
(a) Duty of Furnishers of Information To Provide Accurate
Information.--
(1) Prohibition.--
(A) Reporting information with actual
knowledge of errors.--A person shall not
furnish any information relating to a consumer
to any consumer reporting agency if the person
knows or has reasonable cause to believe that
the information is inaccurate.
(B) Reporting information after notice and
confirmation of errors.--A person shall not
furnish information relating to a consumer to
any consumer reporting agency if--
(i) the person has been notified by
the consumer, at the address specified
by the person for such notices, that
specific information is inaccurate; and
(ii) the information is, in fact,
inaccurate.
(C) No address requirement.--A person who
clearly and conspicuously specifies to the
consumer an address for notices referred to in
subparagraph (B) shall not be subject to
subparagraph (A); however, nothing in
subparagraph (B) shall require a person to
specify such an address.
(D) Definition.--For purposes of subparagraph
(A), the term ``reasonable cause to believe
that the information is inaccurate'' means
having specific knowledge, other than solely
allegations by the consumer, that would cause a
reasonable person to have substantial doubts
about the accuracy of the information.
(E) Rehabilitation of private education
loans.--
(i) In general.--Notwithstanding any
other provision of this section, a
consumer may request a financial
institution to remove from a consumer
report a reported default regarding a
private education loan, and such
information shall not be considered
inaccurate, if--
(I) the financial institution
chooses to offer a loan
rehabilitation program which
includes, without limitation, a
requirement of the consumer to
make consecutive on-time
monthly payments in a number
that demonstrates, in the
assessment of the financial
institution offering the loan
rehabilitation program, a
renewed ability and willingness
to repay the loan; and
(II) the requirements of the
loan rehabilitation program
described in subclause (I) are
successfully met.
(ii) Banking agencies.--
(I) In general.--If a
financial institution is
supervised by a Federal banking
agency, the financial
institution shall seek written
approval concerning the terms
and conditions of the loan
rehabilitation program
described in clause (i) from
the appropriate Federal banking
agency.
(II) Feedback.--An
appropriate Federal banking
agency shall provide feedback
to a financial institution
within 120 days of a request
for approval under subclause
(I).
(iii) Limitation.--
(I) In general.--A consumer
may obtain the benefits
available under this subsection
with respect to rehabilitating
a loan only 1 time per loan.
(II) Rule of construction.--
Nothing in this subparagraph
may be construed to require a
financial institution to offer
a loan rehabilitation program
or to remove any reported
default from a consumer report
as a consideration of a loan
rehabilitation program, except
as described in clause (i).
(iv) Definitions.--For purposes of
this subparagraph--
(I) the term ``appropriate
Federal banking agency'' has
the meaning given the term in
section 3 of the Federal
Deposit Insurance Act (12
U.S.C. 1813); and
(II) the term ``private
education loan'' has the
meaning given the term in
section 140(a) of the Truth in
Lending Act (15 U.S.C.
1650(a)).
(2) Duty to correct and update information.--A person
who--
(A) regularly and in the ordinary course of
business furnishes information to one or more
consumer reporting agencies about the person's
transactions or experiences with any consumer;
and
(B) has furnished to a consumer reporting
agency information that the person determines
is not complete or accurate,
shall promptly notify the consumer reporting agency of
that determination and provide to the agency any
corrections to that information, or any additional
information, that is necessary to make the information
provided by the person to the agency complete and
accurate, and shall not thereafter furnish to the
agency any of the information that remains not complete
or accurate.
(3) Duty to provide notice of dispute.--If the
completeness or accuracy of any information furnished
by any person to any consumer reporting agency is
disputed to such person by a consumer, the person may
not furnish the information to any consumer reporting
agency without notice that such information is disputed
by the consumer.
(4) Duty to provide notice of closed accounts.--A
person who regularly and in the ordinary course of
business furnishes information to a consumer reporting
agency regarding a consumer who has a credit account
with that person shall notify the agency of the
voluntary closure of the account by the consumer, in
information regularly furnished for the period in which
the account is closed.
(5) Duty to provide notice of delinquency of
accounts.--(A) In general.--A person who furnishes
information to a consumer reporting agency regarding a
delinquent account being placed for collection, charged
to profit or loss, or subjected to any similar action
shall, not later than 90 days after furnishing the
information, notify the agency of the date of
delinquency on the account, which shall be the month
and year of the commencement of the delinquency on the
account that immediately preceded the action.
(B) Rule of construction.--For purposes of
this paragraph only, and provided that the
consumer does not dispute the information, a
person that furnishes information on a
delinquent account that is placed for
collection, charged for profit or loss, or
subjected to any similar action, complies with
this paragraph, if--
(i) the person reports the same date
of delinquency as that provided by the
creditor to which the account was owed
at the time at which the commencement
of the delinquency occurred, if the
creditor previously reported that date
of delinquency to a consumer reporting
agency;
(ii) the creditor did not previously
report the date of delinquency to a
consumer reporting agency, and the
person establishes and follows
reasonable procedures to obtain the
date of delinquency from the creditor
or another reliable source and reports
that date to a consumer reporting
agency as the date of delinquency; or
(iii) the creditor did not previously
report the date of delinquency to a
consumer reporting agency and the date
of delinquency cannot be reasonably
obtained as provided in clause (ii),
the person establishes and follows
reasonable procedures to ensure the
date reported as the date of
delinquency precedes the date on which
the account is placed for collection,
charged to profit or loss, or subjected
to any similar action, and reports such
date to the credit reporting agency.
(6) Duties of furnishers upon notice of identity
theft-related information.--
(A) Reasonable procedures.--A person that
furnishes information to any consumer reporting
agency shall have in place reasonable
procedures to respond to any notification that
it receives from a consumer reporting agency
under section 605B relating to information
resulting from identity theft, to prevent that
person from refurnishing such blocked
information.
(B) Information alleged to result from
identity theft.--If a consumer submits an
identity theft report to a person who furnishes
information to a consumer reporting agency at
the address specified by that person for
receiving such reports stating that information
maintained by such person that purports to
relate to the consumer resulted from identity
theft, the person may not furnish such
information that purports to relate to the
consumer to any consumer reporting agency,
unless the person subsequently knows or is
informed by the consumer that the information
is correct.
(7) Negative information.--
(A) Notice to consumer required.--
(i) In general.--If any financial
institution that extends credit and
regularly and in the ordinary course of
business furnishes information to a
consumer reporting agency described in
section 603(p) furnishes negative
information to such an agency regarding
credit extended to a customer, the
financial institution shall provide a
notice of such furnishing of negative
information, in writing, to the
customer.
(ii) Notice effective for subsequent
submissions.--After providing such
notice, the financial institution may
submit additional negative information
to a consumer reporting agency
described in section 603(p) with
respect to the same transaction,
extension of credit, account, or
customer without providing additional
notice to the customer.
(B) Time of notice.--
(i) In general.--The notice required
under subparagraph (A) shall be
provided to the customer prior to, or
no later than 30 days after, furnishing
the negative information to a consumer
reporting agency described in section
603(p).
(ii) Coordination with new account
disclosures.--If the notice is provided
to the customer prior to furnishing the
negative information to a consumer
reporting agency, the notice may not be
included in the initial disclosures
provided under section 127(a) of the
Truth in Lending Act.
(C) Coordination with other disclosures.--The
notice required under subparagraph (A)--
(i) may be included on or with any
notice of default, any billing
statement, or any other materials
provided to the customer; and
(ii) must be clear and conspicuous.
(D) Model disclosure.--
(i) Duty of bureau.--The Bureau shall
prescribe a brief model disclosure that
a financial institution may use to
comply with subparagraph (A), which
shall not exceed 30 words.
(ii) Use of model not required.--No
provision of this paragraph may be
construed to require a financial
institution to use any such model form
prescribed by the Bureau.
(iii) Compliance using model.--A
financial institution shall be deemed
to be in compliance with subparagraph
(A) if the financial institution uses
any model form prescribed by the Bureau
under this subparagraph, or the
financial institution uses any such
model form and rearranges its format.
(E) Use of notice without submitting negative
information.--No provision of this paragraph
shall be construed as requiring a financial
institution that has provided a customer with a
notice described in subparagraph (A) to furnish
negative information about the customer to a
consumer reporting agency.
(F) Safe harbor.--A financial institution
shall not be liable for failure to perform the
duties required by this paragraph if, at the
time of the failure, the financial institution
maintained reasonable policies and procedures
to comply with this paragraph or the financial
institution reasonably believed that the
institution is prohibited, by law, from
contacting the consumer.
(G) Definitions.--For purposes of this
paragraph, the following definitions shall
apply:
(i) Negative information.--The term
``negative information'' means
information concerning a customer's
delinquencies, late payments,
insolvency, or any form of default.
(ii) Customer; financial
institution.--The terms ``customer''and
``financial institution'' have the same
meanings as in section 509 Public Law
106-102.
(8) Ability of consumer to dispute information
directly with furnisher.--
(A) In general.--The Bureau shall, in
consultation with the Federal Trade Commission,
the Federal banking agencies, and the National
Credit Union Administration, prescribe
regulations that shall identify the
circumstances under which a furnisher shall be
required to reinvestigate a dispute concerning
the accuracy of information contained in a
consumer report on the consumer, based on a
direct request of a consumer.
(B) Considerations.--In prescribing
regulations under subparagraph (A), the
agencies shall weigh--
(i) the benefits to consumers with
the costs on furnishers and the credit
reporting system;
(ii) the impact on the overall
accuracy and integrity of consumer
reports of any such requirements;
(iii) whether direct contact by the
consumer with the furnisher would
likely result in the most expeditious
resolution of any such dispute; and
(iv) the potential impact on the
credit reporting process if credit
repair organizations, as defined in
section 403(3), including entities that
would be a credit repair organization,
but for section 403(3)(B)(i), are able
to circumvent the prohibition in
subparagraph (G).
(C) Applicability.--Subparagraphs (D) through
(G) shall apply in any circumstance identified
under the regulations promulgated under
subparagraph (A).
(D) Submitting a notice of dispute.--A
consumer who seeks to dispute the accuracy of
information shall provide a dispute notice
directly to such person at the address
specified by the person for such notices that--
(i) identifies the specific
information that is being disputed;
(ii) explains the basis for the
dispute; and
(iii) includes all supporting
documentation required by the furnisher
to substantiate the basis of the
dispute.
(E) Duty of person after receiving notice of
dispute.--After receiving a notice of dispute
from a consumer pursuant to subparagraph (D),
the person that provided the information in
dispute to a consumer reporting agency shall--
(i) conduct an investigation with
respect to the disputed information;
(ii) review all relevant information
provided by the consumer with the
notice;
(iii) complete such person's
investigation of the dispute and report
the results of the investigation to the
consumer before the expiration of the
period under section 611(a)(1) within
which a consumer reporting agency would
be required to complete its action if
the consumer had elected to dispute the
information under that section; and
(iv) if the investigation finds that
the information reported was
inaccurate, promptly notify each
consumer reporting agency to which the
person furnished the inaccurate
information of that determination and
provide to the agency any correction to
that information that is necessary to
make the information provided by the
person accurate.
(F) Frivolous or irrelevant dispute.--
(i) In general.--This paragraph shall
not apply if the person receiving a
notice of a dispute from a consumer
reasonably determines that the dispute
is frivolous or irrelevant, including--
(I) by reason of the failure
of a consumer to provide
sufficient information to
investigate the disputed
information; or
(II) the submission by a
consumer of a dispute that is
substantially the same as a
dispute previously submitted by
or for the consumer, either
directly to the person or
through a consumer reporting
agency under subsection (b),
with respect to which the
person has already performed
the person's duties under this
paragraph or subsection (b), as
applicable.
(ii) Notice of determination.--Upon
making any determination under clause
(i) that a dispute is frivolous or
irrelevant, the person shall notify the
consumer of such determination not
later than 5 business days after making
such determination, by mail or, if
authorized by the consumer for that
purpose, by any other means available
to the person.
(iii) Contents of notice.--A notice
under clause (ii) shall include--
(I) the reasons for the
determination under clause (i);
and
(II) identification of any
information required to
investigate the disputed
information, which may consist
of a standardized form
describing the general nature
of such information.
(G) Exclusion of credit repair
organizations.--This paragraph shall not apply
if the notice of the dispute is submitted by,
is prepared on behalf of the consumer by, or is
submitted on a form supplied to the consumer
by, a credit repair organization, as defined in
section 403(3), or an entity that would be a
credit repair organization, but for section
403(3)(B)(i).
(9) Duty to provide notice of status as medical
information furnisher.--A person whose primary business
is providing medical services, products, or devices, or
the person's agent or assignee, who furnishes
information to a consumer reporting agency on a
consumer shall be considered a medical information
furnisher for purposes of this title, and shall notify
the agency of such status.
(b) Duties of Furnishers of Information Upon Notice of
Dispute.--
(1) In general.--After receiving notice pursuant to
section 611(a)(2) of a dispute with regard to the
completeness or accuracy of any information provided by
a person to a consumer reporting agency, the person
shall--
(A) conduct an investigation with respect to
the disputed information;
(B) review all relevant information provided
by the consumer reporting agency pursuant to
section 611(a)(2);
(C) report the results of the investigation
to the consumer reporting agency;
(D) if the investigation finds that the
information is incomplete or inaccurate, report
those results to all other consumer reporting
agencies to which the person furnished the
information and that compile and maintain files
on consumers on a nationwide basis; and
(E) if an item of information disputed by a
consumer is found to be inaccurate or
incomplete or cannot be verified after any
reinvestigation under paragraph (1), for
purposes of reporting to a consumer reporting
agency only, as appropriate, based on the
results of the reinvestigation promptly--
(i) modify that item of information;
(ii) delete that item of information;
or
(iii) permanently block the reporting
of that item of information.
(2) Deadline.--A person shall complete all
investigations, reviews, and reports required under
paragraph (1) regarding information provided by the
person to a consumer reporting agency, before the
expiration of the period under section 611(a)(1) within
which the consumer reporting agency is required to
complete actions required by that section regarding
that information.
(c) Limitation on Liability.--Except as provided in section
621(c)(1)(B), sections 616 and 617 do not apply to any
violation of--
(1) subsection (a) of this section, including any
regulations issued thereunder;
(2) subsection (e) of this section, except that
nothing in this paragraph shall limit, expand, or
otherwise affect liability under section 616 or 617, as
applicable, for violations of subsection (b) of this
section; or
(3) subsection (e) of section 615.
(d) Limitation on Enforcement.--The provisions of law
described in paragraphs (1) through (3) of subsection (c)
(other than with respect to the exception described in
paragraph (2) of subsection (c)) shall be enforced exclusively
as provided under section 621 by the Federal agencies and
officials and the State officials identified in section 621.
(e) Accuracy Guidelines and Regulations Required.--
(1) Guidelines.--The Bureau shall, with respect to
persons or entities that are subject to the enforcement
authority of the Bureau under section 621--
(A) establish and maintain guidelines for use
by each person that furnishes information to a
consumer reporting agency regarding the
accuracy and integrity of the information
relating to consumers that such entities
furnish to consumer reporting agencies, and
update such guidelines as often as necessary;
and
(B) prescribe regulations requiring each
person that furnishes information to a consumer
reporting agency to establish reasonable
policies and procedures for implementing the
guidelines established pursuant to subparagraph
(A).
(2) Criteria.--In developing the guidelines required
by paragraph (1)(A), the Bureau shall--
(A) identify patterns, practices, and
specific forms of activity that can compromise
the accuracy and integrity of information
furnished to consumer reporting agencies;
(B) review the methods (including
technological means) used to furnish
information relating to consumers to consumer
reporting agencies;
(C) determine whether persons that furnish
information to consumer reporting agencies
maintain and enforce policies to ensure the
accuracy and integrity of information furnished
to consumer reporting agencies; and
(D) examine the policies and processes that
persons that furnish information to consumer
reporting agencies employ to conduct
reinvestigations and correct inaccurate
information relating to consumers that has been
furnished to consumer reporting agencies.
(f) Additional Notice Requirements for Medical Debt.--Before
furnishing information regarding a medical debt of a consumer
to a consumer reporting agency, the person furnishing the
information shall send a statement to the consumer that
includes the following:
(1) A notification that the medical debt--
(A) may not be included on a consumer report
made by a consumer reporting agency until the
later of the date that is 365 days after--
(i) the date on which the person
sends the statement;
(ii) with respect to the medical debt
of a borrower demonstrating hardship, a
date determined by the Director of the
Bureau; or
(iii) the date described under
section 605(a)(10); and
(B) may not ever be included on a consumer
report made by a consumer reporting agency, if
the medical debt arises from a medically
necessary procedure.
(2) A notification that, if the debt is settled or
paid by the consumer or an insurance company before the
end of the period described under paragraph (1)(A), the
debt may not be reported to a consumer reporting
agency.
(3) A notification that the consumer may--
(A) communicate with an insurance company to
determine coverage for the debt; or
(B) apply for financial assistance.
(g) Furnishing of Medical Debt Information.--
(1) Prohibition on reporting debt related to
medically necessary procedures.--No person shall
furnish any information to a consumer reporting agency
regarding a debt arising from a medically necessary
procedure.
(2) Treatment of other medical debt information.--
With respect to a medical debt not described under
paragraph (1), no person shall furnish any information
to a consumer reporting agency regarding such debt
before the end of the 365-day period beginning on the
later of--
(A) the date on which the person sends the
statement described under subsection (f) to the
consumer;
(B) with respect to the medical debt of a
borrower demonstrating hardship, a date
determined by the Director of the Bureau; or
(C) the date described in section 605(a)(10).
(3) Treatment of settled or paid medical debt.--With
respect to a medical debt not described under paragraph
(1), no person shall furnish any information to a
consumer reporting agency regarding such debt if the
debt is settled or paid by the consumer or an insurance
company before the end of the 365-day period described
under paragraph (2).
(4) Borrower demonstrating hardship defined.--In this
subsection, and with respect to a medical debt, the
term ``borrower demonstrating hardship'' means a
borrower or a class of borrowers who, as determined by
the Director of the Bureau, is facing or has
experienced unusual extenuating life circumstances or
events that result in severe financial or personal
barriers such that the borrower or class of borrowers
does not have the capacity to repay the medical debt.
* * * * * * *
MINORITY VIEWS
Democrats continue to try to socialize the health care and
credit reporting industries--costing Americans their access to
medical treatments and necessary credit at a time when they can
least afford it--instead of working with Republicans to find
solutions for those most in need.
For millions of Americans, an unexpected medical bill can
be devastating to their financial health. Now, due to the
COVID-19 pandemic, even more people find themselves facing an
unplanned hospital stay, procedure, or repeated doctor's
visits. This is a serious problem impacting communities across
our country, but H.R. 5330 is not the solution.
This bill will increase the overall cost of health care at
a time when Americans can least afford it. Eliminating debt for
one group of individuals only shifts the costs to others--
making the overall cost of healthcare more expensive. It also
increases the costs of medical procedures as well as limits
access to necessary procedures. Consider this, healthcare
providers who are not paid for their services ultimately limit
the services they provide while at the same time making them
more expensive--this will impact the patients who need these
services the most.
H.R. 5330 would also jeopardize the credit of millions of
low-to-moderate income families' who are on the bubble. H.R.
5330 would fundamentally alter the ability of credit markets to
determine risk by removing predictive information--in other
words, remove their ability to assess how likely someone is to
repay a debt--from credit modeling paradigms. The inability to
determine risk in turn raises the costs of credit for all
Americans--jeopardizing access to credit for those who need it
most.
Committee Republicans recognize the need to address
unplanned medical debt and support a more responsible approach.
Rep. Barry Loudermilk (R-GA) offered an amendment during the
markup of this bill, which would have excluded information
related to non-elective, medically necessary paid debt from
consumer reports more than a year old. That amendment was
defeated along party lines by a vote of 24-32.
Republicans want to preserve access to credit for low- and
moderate-income Americans, particularly during this time of
economic uncertainty. Committee Republicans also support
providing a path to quickly remove paid medical debt from
consumer reports after one year, instead of having negative
data reported for seven years, which is the current practice.
However, Democrats refuse to work with Republicans to
identify bipartisan solutions that will help consumers who need
it the most. Republicans will continue to advocate for policies
that ensure Americans have access to affordable healthcare and
credit.
For these reasons, Committee Republicans oppose H.R. 5330.
Patrick T. McHenry.
Bill Posey.
Bill Huizenga.
Ann Wagner.
Scott R. Tipton.
J. French Hill.
Lee M. Zeldin.
Alexander X. Mooney.
Ted Budd.
Trey Hollingsworth.
John W. Rose (TN).
Lance Gooden.
William R. Timmons, IV.
Frank D. Lucas.
Blaine Luetkemeyer.
Steve Stivers.
Andy Barr.
Roger Williams.
Tom Emmer.
Barry Loudermilk.
Warren Davidson.
David Kustoff.
Anthony Gonzalez (OH).
Bryan Steil.
Denver Riggleman.
Van Taylor.
[all]