The bill amends Section 20.05 of the Business & Commerce Code to enhance consumer protections regarding the reporting of medically necessary debt on consumer reports. Specifically, it prohibits consumer reporting agencies from including information about medically necessary debt, regardless of when the debt was incurred, in consumer reports. This addition aims to ensure that individuals who have incurred medical debt for necessary healthcare services are not unfairly penalized in their credit reports. The bill also clarifies the definition of "medically necessary debt," which includes debts arising from healthcare services aimed at diagnosing, treating, or preventing illnesses.

Additionally, the bill modifies existing provisions related to the reporting of various types of debts and judgments, including bankruptcy cases, tax liens, and collection accounts. The amendments specify that collection accounts related to medical services are only reportable if the consumer was not covered by a health benefit plan at the time of the event leading to the collection. The changes will take effect on September 1, 2025, and will apply only to consumer reports furnished on or after that date, ensuring that reports generated before this date will adhere to the previous legal framework.

Statutes affected:
Introduced: Commerce Code 20.05 (Commerce Code 20)