Key Points
Senate Republicans introduced a resolution to nullify a CFPB rule banning medical debt from credit reports.
Critics say the rule exceeds the CFPB’s authority and could limit consumer access to credit.
The rule is also facing legal challenges from credit industry and debt collection groups.
Details
Republican lawmakers in Congress are pushing to overturn a new rule from the Consumer Financial Protection Bureau (CFPB) that bans medical debt from appearing on credit reports and restricts its use in lending decisions.
Sen. Mike Rounds (R-S.D.) has introduced S.J. Res. 36, a Congressional Review Act (CRA) resolution aimed at nullifying the rule, which was finalized by the CFPB on January 7, 2025, just days before President Biden left office. The resolution is cosponsored by Sen. Tim Scott (R-S.C.), chairman of the Senate Banking Committee.
“The CFPB going beyond their statutory authority to eliminate all medical debt from credit reports is irresponsible and a clear example of regulatory overreach,” Rounds said. He warned that the rule could lead to banks having a “less clear credit picture” and limit access to credit for consumers.
A companion resolution, H.J. Res. 74, has been introduced in the House by Rep. Ralph Norman (R-S.C.).
Sen. Scott echoed those concerns, stating that while medical debt is a serious issue, “this rule will do nothing to address the underlying issues. Instead, it will reduce access to credit and important health care services for those most in need.”
The rule was finalized in January 2025 as the CFPB was preparing to pack up and turn over its operations to the incoming Trump Administration.
"People who get sick shouldn't have their financial future upended," CFPB Director Rohit Chopra said in announcing the new rules in January. "The CFPB's final rule will close a special carveout that has allowed debt collectors to abuse the credit reporting system to coerce people into paying medical bills they may not even owe."
Rule faces legal challenges
The CFPB rule is also being challenged in court. Two separate lawsuits have been filed in federal courts in Texas:
The Consumer Data Industry Association (CDIA) and the Cornerstone Credit Union League filed the first suit, claiming the rule “plainly exceeds” the CFPB’s legal authority under the Fair Credit Reporting Act.
A second suit by ACA International, a debt collection industry group, and Specialized Collection Services Inc., argues the CFPB is exploiting public frustration with medical bills to issue a politically motivated regulation.
Both suits contend the CFPB lacks both the legal authority and the healthcare expertise to impose such restrictions and argue the rule is based more on politics than policy.
The CFPB has not yet publicly responded to the congressional resolutions or the lawsuits.