Nevada has about 170,000 adults who report medical debt, which can pose a significant financial hardship. But a new federal rule could ease some pressure when folks apply for loans.
The Consumer Financial Protection Bureau has finalized a rule that says credit agencies can't share a person's medical debt history with a lending institution.
The only debt credit agencies can share are mortgages, car loans, credit cards and similar activities.
Patricia Kelmar - senior director for health care campaigns of the Public Interest Research Group - said groups like hers have long pushed for this move.
"Medical debt is not really indicative of somebody's ability or desire to pay back a loan," said Kelmar. "Oftentimes people are in a situation where they get a bad medical diagnosis, or they've been in a car accident. Suddenly they have a lot of medical bills."
In 2021, the Silver State passed legislation requiring debt collectors to provide written notice to people with medical debt 60 days before taking action to collect on that debt.
Some credit agencies already exclude medical debt from loan situations.
Kelmar acknowledged that the incoming Trump administration could try to reverse this rule change. Some Trump advisers have said they want to do away with the CFPB altogether.
Analysts also expect pushback from debt-collection firms. But Kelmar said skeptics should know keeping medical debt out of the equation is good for the economy.
"The long arm of medical debt can really hurt people's financial future," said Kelmar, "and their ability to get better."
For example, she said someone coming out of a medical scare might need a new car to rejoin the workforce, but sudden healthcare debt might get in the way.
The new rule will take effect 60 days after it's published in the Federal Register.
