[Federal Register Volume 87, Number 13 (Thursday, January 20, 2022)]
[Rules and Regulations]
[Pages 3025-3026]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2022-01012]



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 Rules and Regulations
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 This section of the FEDERAL REGISTER contains regulatory documents 
 having general applicability and legal effect, most of which are keyed 
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  Federal Register / Vol. 87, No. 13 / Thursday, January 20, 2022 / 
Rules and Regulations  

[[Page 3025]]



BUREAU OF CONSUMER FINANCIAL PROTECTION

12 CFR Parts 1006 and 1022


Bulletin 2022-01: Medical Debt Collection and Consumer Reporting 
Requirements in Connection With the No Surprises Act

AGENCY: Bureau of Consumer Financial Protection.

ACTION: Compliance bulletin and policy guidance.

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SUMMARY: The Bureau of Consumer Financial Protection (Bureau) is 
issuing this compliance bulletin and policy guidance (Bulletin) to 
remind debt collectors of their obligation to comply with the Fair Debt 
Collection Practices Act's prohibition on false, deceptive, or 
misleading representations or means in connection with the collection 
of any debt and unfair or unconscionable means to collect or attempt to 
collect any debt, and to remind consumer reporting agencies and 
information furnishers to comply with the Fair Credit Reporting Act's 
accuracy and dispute resolution requirements, including when 
collecting, furnishing information about, and reporting medical debts 
covered by the No Surprises Act.

DATES: This Bulletin is applicable as of January 20, 2022.

FOR FURTHER INFORMATION CONTACT: Seth Caffrey, Courtney Jean, Kristin 
McPartland, or Alexandra Reimelt, Senior Counsels, Office of 
Regulations, at 202-435-7700. If you require this document in an 
alternative electronic format, please contact 
[email protected].

SUPPLEMENTARY INFORMATION:

I. Bulletin

    The Bureau is issuing this Bulletin to emphasize the obligation of 
debt collectors to comply with the Fair Debt Collection Practices Act's 
(FDCPA) \1\ prohibitions on false, deceptive, or misleading 
representations or means in connection with the collection of any debt 
and unfair or unconscionable means to collect or attempt to collect any 
debt, and the obligation of consumer reporting agencies and information 
furnishers to comply with the Fair Credit Reporting Act's (FCRA) \2\ 
accuracy and dispute resolution requirements, including when 
collecting, furnishing information about, and reporting medical debts 
covered by the No Surprises Act. This Bulletin describes certain acts 
or practices related to the collection of medical debts that may 
violate the FDCPA or the FCRA. The examples described in this bulletin 
are not exhaustive of all potential violations of the FDCPA and FCRA 
that could arise from the collection of such debts.
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    \1\ 15 U.S.C. 1692 et seq.
    \2\ 15 U.S.C. 1681 et seq.
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    Effective generally for plan years beginning on or after January 1, 
2022, the No Surprises Act \3\ protects participants, beneficiaries, 
and enrollees in group health plans and group and individual health 
insurance coverage from surprise medical bills when they receive, under 
certain circumstances, emergency services, non-emergency services from 
nonparticipating providers at participating health care facilities, and 
air ambulance services from nonparticipating providers of air ambulance 
services.\4\ In addition, the No Surprises Act, among other things, 
requires certain health care facilities and providers to disclose 
Federal and State patient protections against balance billing and sets 
forth complaint processes with respect to potential violations of the 
protections against balance billing and out-of-network cost sharing.\5\ 
The No Surprises Act also includes certain protections for uninsured 
(or self-pay) individuals from surprise medical bills.\6\ Several 
Federal agencies have published rules implementing the No Surprises 
Act.\7\
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    \3\ Public Law 116-260, div. BB, tit. I, 134 Stat. 2758 (2020).
    \4\ See Requirements Related to Surprise Billing; Part I, 86 FR 
36872 (July 13, 2021). The protections against surprise billing also 
apply to health benefits plans offered by carriers under the Federal 
Employees Health Benefits (FEHB) Act. See 5 U.S.C. 8901(p).
    \5\ See Requirements Related to Surprise Billing; Part I, 86 FR 
36872 (July 13, 2021).
    \6\ See Requirements Related to Surprise Billing; Part II, 86 FR 
55980 (Oct. 7, 2021).
    \7\ See, e.g., id. (interim final rule issued by Office of 
Personnel Management; Internal Revenue Service, Department of the 
Treasury; Employee Benefits Security Administration, Department of 
Labor; Centers for Medicare and Medicaid Services, Department of 
Health and Human Services); Requirements Related to Surprise 
Billing; Part I, 86 FR 36872 (July 13, 2021) (same).
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    Several characteristics of medical debt pose special risks to 
consumers and distinguish it from other types of debt.\8\ Medical debt 
often results from an unanticipated event, such as an accident or 
sudden illness, rather than from a voluntary, planned transaction. 
Consumers are rarely informed of the costs of medical treatment in 
advance (although provisions in the No Surprises Act will help to 
remedy this), and because of price opacity, provider availability, and 
the emergency nature of some medical care, consumers may have only a 
limited ability to ``shop around.'' In addition, medical bills can be 
rife with errors, and the unique complexity of the medical billing and 
third-party reimbursement process exacerbates consumer confusion. A 
consumer faced with a bill for medical services is generally ill suited 
to the task of identifying billing errors, including, for example, 
identifying whether the billed services were actually received and 
whether the correct amount was billed. A consumer also may have 
difficulty determining whether the amount is covered by insurance (if 
applicable) and, if so, whether and to what extent the amount was 
already paid.
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    \8\ See generally Bureau of Consumer Fin. Prot., Consumer credit 
reports: A study of medical and non-medical collections (Dec. 2014), 
at 15-16, 38-42, https://files.consumerfinance.gov/f/201412_cfpb_reports_consumer-credit-medical-and-non-medical-collections.pdf.
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    If a medical bill remains unpaid after a certain amount of time, a 
medical provider may engage a third party to collect the debt.\9\ To 
the extent the third party qualifies as a ``debt collector'' under the 
FDCPA and its implementing Regulation F, the third party is subject to 
the FDCPA and Regulation F.\10\ The FDCPA and Regulation F prohibit the 
use of ``any false, deceptive, or misleading representation or means in 
connection with the collection of any

[[Page 3026]]

debt,'' \11\ including, for example, any false representation of ``the 
character, amount, or legal status of any debt.'' \12\ The FDCPA and 
Regulation F also prohibit the use of ``unfair or unconscionable means 
to collect or attempt to collect any debt,'' \13\ including, for 
example, 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.'' \14\
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    \9\ See generally Debt Collection Practices (Regulation F), 85 
FR 76734, 76735-36 (Nov. 30, 2020).
    \10\ 15 U.S.C. 1692a(6) (defining ``debt collector''); 12 CFR 
1006.2(i) (same).
    \11\ 15 U.S.C. 1692e; 12 CFR 1006.18(a).
    \12\ 15 U.S.C. 1692e(2)(A); 12 CFR 1006.18(b)(2)(i).
    \13\ 15 U.S.C. 1692f; 12 CFR 1006.22(a).
    \14\ 15 U.S.C. 1692f(1); 12 CFR 1006.22(b). See also, e.g., 
Tuttle v. Equifax Check, 190 F.3d 9, 13 (2nd Cir. 1999) (noting 
that, if state law expressly prohibits service charges, a service 
charge cannot be imposed even if the contract allows it).
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    The Bureau reminds debt collectors about these FDCPA prohibitions. 
The prohibition on misrepresentations includes misrepresenting that a 
consumer must pay a debt stemming from a charge that exceeds the amount 
permitted by the No Surprises Act. Thus, for example, a debt collector 
who represents that a consumer owes a debt arising from out-of-network 
charges for emergency services may violate the prohibition on 
misrepresentations if those charges exceed the amount permitted by the 
No Surprises Act. Courts have also emphasized that collecting an amount 
that exceeds what is owed would violate the prohibition on unfair or 
unconscionable debt collection practices.
    Many debt collectors furnish information about unpaid medical debts 
to consumer reporting agencies (CRAs).\15\ Debt collectors who furnish 
information and the CRAs to which they furnish that information are 
subject to the FCRA and its implementing Regulation V.\16\ The FCRA and 
Regulation V impose obligations on CRAs and furnishers relating to the 
accuracy of information in consumer reports. Among these is the 
requirement that, when preparing a consumer report, CRAs ``shall follow 
reasonable procedures to assure maximum possible accuracy of the 
information concerning the individual about whom the report relates,'' 
\17\ and the requirement that furnishers ``establish and implement 
reasonable written policies and procedures regarding the accuracy and 
integrity of the information relating to consumers that it furnishes to 
a consumer reporting agency.'' \18\ The FCRA and Regulation V also 
require CRAs and furnishers to conduct reasonable and timely 
investigations of consumer disputes to verify the accuracy of furnished 
information.\19\
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    \15\ See Bureau of Consumer Fin. Prot., Market Snapshot: Third-
Party Debt Collections Tradeline Reporting, at 5, 12-14 (July 2019), 
https://files.consumerfinance.gov/f/documents/201907_cfpb_third-party-debt-collections_report.pdf (finding that, in the second 
quarter of 2018, medical debt accounted for approximately two-thirds 
of total third-party collections tradelines). See also Bureau of 
Consumer Fin. Prot., Consumer credit reports: A study of medical and 
non-medical collections, at 4-5 (Dec. 2014), https://files.consumerfinance.gov/f/201412_cfpb_reports_consumer-credit-medical-and-non-medical-collections.pdf (finding that, based on data 
from 2012 through 2014, medical debt collections tradelines affected 
the credit reports of nearly one-fifth of all consumers with credit 
reports); id. at 5 (finding that, based on data from 2012 through 
2014, medical debt collection tradelines accounted for over half of 
all debt collection tradelines with an identifiable creditor or 
provider).
    \16\ 15 U.S.C. 1681 through 1681x; 12 CFR part 1022.
    \17\ 15 U.S.C. 1681e(b).
    \18\ 12 CFR 1022.42(a).
    \19\ 15 U.S.C. 1681i, 1681s-2; 12 CFR 1022.43.
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    The Bureau reminds furnishers and CRAs that the accuracy and 
dispute obligations imposed by the FCRA and Regulation V apply with 
respect to debts stemming from charges that exceed the amount permitted 
by the No Surprises Act. Thus, for example, a debt collector who 
furnishes information indicating that a consumer owes a debt arising 
from out-of-network charges for emergency services (or a CRA that 
includes such information in a consumer report) may violate the FCRA 
and Regulation V if those charges exceed the amount permitted by the No 
Surprises Act or if the furnisher (or CRA) fails to meet its dispute 
obligations.
    The Bureau will closely review the practices of those engaged in 
the collection or reporting of medical debt. The Bureau will hold debt 
collectors accountable for failing to comply with the FDCPA and 
Regulation F, and it will hold CRAs and furnishers accountable for 
failing to comply with the FCRA and Regulation V. The Bureau will use 
all appropriate tools to assess whether supervisory, enforcement, or 
other action may be necessary.

II. Regulatory Matters

    This Bulletin constitutes a general statement of policy exempt from 
the notice and comment rulemaking requirements of the Administrative 
Procedure Act.\20\ It summarizes existing legal requirements. It does 
not impose any legal requirements on external parties, nor does it 
create or confer any substantive rights on external parties that could 
be enforceable in any administrative or civil proceeding. Because no 
notice of proposed rulemaking is required in issuing this Bulletin, the 
Regulatory Flexibility Act also does not require an initial or final 
regulatory flexibility analysis.\21\ The Bureau has also determined 
that the issuance of this Bulletin does not impose any new or revise 
any existing recordkeeping, reporting, or disclosure requirements on 
covered entities or members of the public that would be collections of 
information requiring approval by the Office of Management and Budget 
under the Paperwork Reduction Act of 1995.\22\
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    \20\ 5 U.S.C. 553(b).
    \21\ 5 U.S.C. 603(a), 604(a).
    \22\ 44 U.S.C. 3501 et seq.

Rohit Chopra,
Director, Consumer Financial Protection Bureau.
[FR Doc. 2022-01012 Filed 1-19-22; 8:45 am]
BILLING CODE 4810-AM-P