Massachusetts Plan Would Keep Medical Debt Off Credit Reports

Massachusetts Governor Maura Healey has proposed regulations that would stop medical debt from being reported on consumer credit reports in Massachusetts. 

The proposed ban targets healthcare providers and debt collectors working for healthcare providers from reporting medical debt to the major credit bureaus.

“Getting sick is hard enough. It shouldn’t ruin your credit,” Healey said. “Medical debt shouldn’t make it harder to buy a home, rent an apartment or get a loan years after you’ve recovered and when you’re working hard to make your payments.”

“Getting sick is hard enough. It shouldn’t ruin your credit.” — Massachusetts Governor Maura Healey

Without such a ban, one unexpected health expense could impact a consumer’s credit rating, according to Massachusetts Lieutenant Governor Kim Driscoll.

“Medical debt can follow families long after they’ve recovered from an illness or emergency,” Driscoll said. “We’re helping to ensure that one unexpected healthcare bill doesn’t create years of financial hardship.”

How the Medical Debt Ban in Massachusetts Would Be Enforced

Under the proposal, Massachusetts healthcare providers that don’t comply could put their licenses at risk.

“Right now we’re tying this to licensure, so both facility licensure and professional licensure,” Massachusetts Public Health Commissioner Robbie Goldstein told State House News Service. 

So the licenses for a healthcare facility or individual healthcare provider could be put at risk under these proposed changes if a Massachusetts consumer’s medical debt is reported to the credit bureaus. 

“It’s a pretty significant penalty for someone who’s trying to provide healthcare,” Goldstein said. 

Impact of Medical Debt on Massachusetts Consumers

In Massachusetts, 13.5% of consumers carry family medical debt, according to the 2025 Massachusetts Health Insurance Survey.

More than half of Massachusetts consumers with medical debt (53.3%) cut back on savings or took money out of their savings to pay for medical expenses. And collection agencies contacted 40.6% of Massachusetts consumers with medical debt about their debts. 

More than a third (35.9%) of those with medical debt borrowed money or took on credit card debt to pay for medical expenses. 

Next Steps in Massachusetts

The Massachusetts Department of Public Health is accepting written public comments on the proposed regulations and public hearings are scheduled for July 27 and July 28. Healey first mentioned a ban on medical debt in her State of the Commonwealth speech in January.

If the regulations are finalized, Massachusetts would become the 16th state to enact such a ban, joining 15 states that already have one.

The states with bans in effect are California, Colorado, Connecticut, Delaware, Illinois, Maine, Maryland, Minnesota, New York, New Jersey, Oregon, Rhode Island, Vermont, Virginia, and Washington State.

Federal Guidance Could Complicate State Medical Debt Bans

In October 2025, the Consumer Financial Protection Bureau (CFPB) issued guidance claiming to prohibit states from removing medical debt from consumer credit reports by claiming the Fair Credit Reporting Act overrides state protections. 

Chi Chi Wu, Director of Consumer Reporting and Data Advocacy at the National Consumer Law Center, said that the rule from the CFPB is not legally binding, but at most would have persuasive value to courts.

She also said even if the CFPB should prevail in its view on medical debt and credit reports, there are other strategies states can take to protect consumers. 

“States can pass laws prohibiting creditors, landlords, and employers from taking medical debt on credit reports into consideration when making decisions,” Wu said in a press release.

“States can also require healthcare providers to include clauses in their contracts with debt collectors that prohibit the collectors from reporting the debts to a credit bureau.”