Blog: CFPB, CMS address illegal nursing home debt collection practices – Financial Regulation News – Financial Regulation News

Consumer Financial Protection Bureau (CFPB) and Centers for Medicare & Medicaid Services (CMS) officials have detailed efforts to address illegal nursing home debt collection practices.

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The agencies have issued a joint letter confirming that a nursing care facility may not require a third-party caregiver to personally guarantee payment of a nursing home resident’s bills as a condition of the resident’s admission to the facility.

The guidance stems from a CFPB Issue Spotlight outlining difficulties and experiences heard from caregivers regarding being pursued over friends’ or family members’ alleged debts from nursing home facilities.

“Nursing homes that participate in Medicare and Medicaid are prohibited from forcing a resident’s family or friends to assume responsibility for the cost of care as a condition of admission or continued stay in the facility,” CFPB Director Rohit Chopra said. “Debt collectors must take steps to ensure they are not violating the law by collecting on invalid nursing home debts.”

The CFPB said the collection tactics violate the Nursing Home Reform Act and subsequent attempts to collect debts from caregivers may violate the Fair Debt Collection Practices Act and the Fair Credit Reporting Act.

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