SALEM, OR – A bill prohibiting credit reporting on Oregonians’ medical debt has been signed into law by Gov. Tina Kotek. Hailed as a significant victory for consumer rights advocates, the bill also removes existing medical debt from credit reports, including debt from medical credit cards.
High medical costs have forced nearly one in three Oregonians into debt in the last two years alone, causing cascading financial harms long after bills are paid.
Adam Zarrin, director of state government affairs with the Leukemia & Lymphoma Society, said the cost of treating leukemia, for example, is almost a half-million dollars, much of which becomes debt.
“So, an individual like that might now be able to stabilize their life, get the job they want, start a business, get a line of credit to move on with their life without the kind of financial burdens you get from medical debt,” Zarrin explained.
Three major credit reporting agencies have already taken steps to remove some medical debt from people’s credit reports voluntarily. Oregon will be the 14th state to implement similar legislation, set to take effect next year.
Chris Coughlin, policy director for Oregon Consumer Justice, said it isn’t fair that people’s ability to rent an apartment or buy a car would be affected by debt they didn’t choose to take on, or that may be inaccurate.
“Sometimes people get sent to collections for debt that’s not theirs through the health care system,” she continued.
On the federal level, Coughlin warns that protections for medical debt and credit reporting, once enforced by the Consumer Financial Protection Bureau, have now been revoked by the Trump administration.
“Now it’s more important than ever for states to take action to protect Oregonians,” she said. “And so, we’re really happy that this bill has moved forward.”
Zarrin added with cuts to Medicaid looming in the future, it is likely that more Americans will lose health care, including over 220,000 Oregonians, resulting in increased medical debt.
Coughlin said it’s yet another reason for states to enact policies to protect their residents.
