Capitol Insights Newsletter

Authors: Luke Schwartz & Matt Reiter

What happened in Congress this week?

The House Energy and Commerce Subcommittee on Health invited Dr. Fowler, Deputy Administrator and Director of the CMS Innovation Center (CMMI), to testify on the effectiveness of value-based payment models at CMMI. This comes in light of CMMI falling short of the cost savings originally predicted in 2010. Legislators on both sides of the aisle, Republicans in particular, are interested in making CMMI more structured and CMMI being subject to increased congressional oversight.

On Wednesday, the House Energy & Commerce Committee unanimously advanced 13 bills out of Committee. These bills included four that focused on reducing Medicaid fraud and another that aims to limit spread pricing by pharmacy benefit managers (PBMs).  

The chief actuaries for the Social Security Administration and Center for Medicare and Medicaid Services (CMS) testified before the House Budget Committee for the first time in 12 years. Members of Congress differed in their ideas of how to improve the solvency of Medicare and Social Security, with Republicans favoring raising the retirement age and Democrats favoring a payroll tax hike for those making over $400,000. However, both parties seemed to understand that the longer this insolvency issue lingers, the harder it will be to solve.

Biden Administration Released Proposed Rule to Remove Medical Debt from Consumer Credit Reports


The Consumer Financial Protection Bureau (CFPB) has proposed a new rule to eliminate medical debt from impacting credit scores and consumers’ ability to get a loan. If finalized, this would impact debt collectors regulated by the Fair Debt Collection Practices Act and credit bureaus regulated by the Fair Credit Reporting Act. Additionally, it prevents medical equipment from being used as collateral, using the example of wheelchairs and prosthetics.


Comments on the proposed rule must be submitted by August 12th.


Reasoning for the Rule

The CFPB asserts that they are taking this action for many reasons relating to the fairness of medical debt relating to lines of credit. The CFPB says that more often than not, medical debt comes from accidents or sudden illness, and consumers have little control over the timing of their debts. They also find that medical bills often contain errors and end up being disputed. The CFPB also highlights how some debt collection agencies “improperly use” the credit reporting system as an over-aggressive collection method. Additionally, the CFPB asserts that medical debt is an inaccurate data point as to whether a consumer will pay future debt, possibly hurting creditors’ ability to make safe and low-risk credit approvals.

Impacts of the Rule

The regulation would close a loophole that has allowed lenders to obtain and use medical information, including medical debt. If enacted, this rule would mean that medical information and medical debt could not impact your credit score. This builds off actions by Equifax, TransUnion, and Experian that have allowed any medical debt of $500 or less to not impact credit scores.

Lenders would only be allowed to use medical information relating to income and benefits, such as disability income, when determining eligibility for a loan. The creditor must use the information “in the same manner and to the same extent it would comparable non-medical information in the eligibility or continued eligibility credit determinations” and cannot “take the consumer’s physical, mental, or behavioral health condition, history, treatment type, or prognosis into account for the eligibility or continued eligibility determination.”

The proposed rule would prohibit lenders from taking medical devices as collateral for a loan, and bans lenders from repossessing medical devices, like wheelchairs or prosthetic limbs, if people are unable to repay the loan.

 Once finalized, the CFPB is giving creditors 60 days to comply with the final rule.



The rule in its current state has many limitations, which the CFPB is seeking comments on. The CFPB hopes to understand how this would impact debt collectors, considering credit scores are one of the main ways to coerce payment. In the rule’s current form, debt collectors would likely need to boost staff and pay more in legal fees to ensure they get paid. If the rule is finalized in its current state, it is unclear how decreasing the incentive to pay off medical debt would impact debt collectors’ enforcement capabilities.

Top Stories in Healthcare Policy

Senators Maggie Hassan (D-NH) and Marsha Blackburn (R-TN) wrote a letter to UnitedHealth Group (UHG) CEO Andrew Witty urging prompt notification to patients and the administration by June 21 regarding breach of sensitive personal health data during the Change Healthcare cyberattack. 

Blue Cross Blue Shield of Michigan, the state’s largest insurer, will no longer cover GLP-1 obesity drugs in large group commercial plans starting next year.

The Food and Drug Administration (FDA) and Department of Justice (DOJ) announced a task force designed to prevent illegal e-cigarettes from entering the United States.

 Earlier this week the Centers for Medicare & Medicaid Services (CMS) announced the availability of $500 million in grants over the next five years to expand the pool of organizations who help people enroll in health coverage via the Federally-Facilitated Marketplace (FFM) on These grants will further the administration’s objective to increase minority communities’ access to health care coverage.

Last Friday, Colorado’s prescription drug affordability board unanimously voted that Stelara is unaffordable for the state’s residents. Manufactured by Janssen, the drug is instrumental in treating Crohn’s disease, ulcerative colitis, plaque psoriasis, and psoriatic arthritis. The board’s ruling could lead to a price cap for the drug. This could lead to an interim solution in Colorado while the drug is simultaneously being negotiated as part of the Medicare Drug Price Negotiation Program. It will be interesting to observe if other state boards take similar action on Stelara or other drugs.

CMS will recalculate Medicare Advantage Star Ratings following successful insurer lawsuits involving SCAN and Elevance last week. The MA Star Ratings system rates MA and Medicare Part D programs based on measurements of customer satisfaction and the quality of care a plan delivers.

On Thursday MedPAC released its second and final report of 2024. Like its April Report, MedPAC highlighted insufficiencies and future problems surrounding physician reimbursement.

Friday morning the Centers for Medicare and Medicaid Services (CMS) announced new flexibilities for initiating No Surprises Act (NSA) open negotiations due to the Change cyberattack disruptions. According to CMS, “Providers, facilities, and providers of air ambulance services whose ability to timely initiate open negotiation for any item or service furnished on or after January 1, 2024, was impacted by the Change Healthcare cybersecurity incident may choose to initiate open negotiation for such items or services at any point during the 120-calendar-day period following the publication of this notice, beginning 6/14/2024 and ending 10/12/2024, regardless of when the payment or notice of denial of payment and disclosures were transmitted.”