The CFPB has received complaints from people receiving collection notices for debts they do not owe, that are already paid, or that should have been covered by insurance or hospital financial assistance programs, according to an Oct. 1 news release.
The bureau notes that hospitals and other providers are increasingly outsourcing medical billing and collection activities to third parties, such as RCM firms, which may have legal obligations under the Fair Debt Collection Practices Act.
The advisory opinion details multiple ways companies are violating federal law when they collect — or attempt to collect— on bills that are inaccurate, unsubstantiated, or invalid under the law. Those practices include: double billing, exceeding legal limits, falsified or fake charges, collecting unsubstantiated medical bills, and misrepresenting consumers’ rights to contest bills.
“Medical billing is often riddled with errors, including inflated or duplicative charges, fees for services the patient never received, or charges already paid,” CFPB Director Rohit Chopra said in the release. “The CFPB is taking action to ensure that Americans are not unfairly chased by debt collectors over unsubstantiated or invalid medical bills.”
Read the full advisory opinion here.
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