HB23-1126 Summary

• Consumer reporting agencies are prohibited from reporting medical debt in consumer reports, except when the report is used for credit transactions exceeding the national conforming loan limit value for one-unit properties as determined by the Federal Housing Finance Agency.

• Medical debt is defined as debt arising from health-care services or goods, including products, devices, durable medical equipment, and prescription drugs, but excludes debt charged to general-purpose credit cards.

• Debt collectors and collection agencies are prohibited from falsely representing that medical debt will be included in a consumer report or factored into a credit score unless the report is for high-value credit transactions exceeding the federal conforming loan limit.

• Debt collectors must include a specific disclosure statement in initial written communications informing consumers that Colorado law prohibits credit bureaus from reporting medical debt or factoring it into credit scores, with limited exceptions.

• The Department of Revenue must contract for a study by January 1, 2028 examining the impact of these restrictions on consumers' creditworthiness, access to credit, and economic stability, with consideration of impacts across different racial groups and income levels; most provisions sunset July 1, 2028.

• $200,000 is appropriated to the Department of Revenue for fiscal year 2023-24 to implement the act.