Congress Moves to Nullify Rule Shielding Medical Data from Credit Checks, Reopening Door for Creditors to Use Health Info

This Joint Resolution is straightforward: it uses the Congressional Review Act (CRA) to formally reject a specific rule issued by the Bureau of Consumer Financial Protection (BCFP). That rule, finalized in early 2022, was designed to prohibit creditors and credit reporting agencies from using consumers' medical information when making lending decisions or calculating credit scores. By disapproving the rule, this resolution ensures that the BCFP’s attempt to protect sensitive health data from the financial sector will never take legal effect, essentially rolling back a new consumer protection measure before it even started.

The Fine Print on Your Health Data

Think about the last time you applied for a loan or a new credit card. The lender pulls your credit report and uses that history to decide if you’re a good risk. The BCFP rule Congress is rejecting aimed to keep highly sensitive medical details—like a recent cancer diagnosis, chronic condition management, or even just high medical debt—out of that equation. The rule recognized that health status shouldn't determine your access to credit or the interest rate you pay. With this resolution, however, that restriction is removed. For everyday people, this means that the financial industry retains the flexibility to incorporate medical information into their risk assessments, potentially impacting everything from mortgage rates to car loans.

Back to Square One: Who Bears the Cost?

This move primarily benefits creditors, lenders, and credit reporting agencies. The rejected rule would have required them to adjust their data processing and risk models to exclude medical information, incurring compliance costs. By nullifying the rule, those industries avoid that regulatory burden and maintain a broader scope of data for evaluating consumers. But for consumers, especially those dealing with significant or chronic health issues, the impact could be substantial. Imagine needing a business loan but getting denied or offered a higher rate because your credit profile flagged high medical bills or a serious illness—data that, under the now-rejected BCFP rule, would have been off-limits. This makes it tougher for people with high healthcare costs to access affordable credit, creating a financial penalty for being sick.

What the CRA Means for Future Protections

This resolution utilizes the Congressional Review Act, a powerful legislative tool that allows Congress to overturn federal agency rules. When the CRA is used to disapprove a rule, it doesn't just stop the rule from taking effect; it also prevents the agency (in this case, the BCFP) from issuing a "substantially similar" rule in the future unless Congress passes a new law specifically authorizing it. This is the policy equivalent of hitting the nuclear button. It’s not just a temporary pause; it’s a permanent block on the BCFP trying to establish this specific type of consumer protection regarding medical data and credit. For someone hoping the BCFP would step in later to protect their health privacy in financial matters, this resolution slams the door shut.