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Washington Appeals Court disagrees with appellant in a class action data breach; affirms lower court’s decision
On January 8, the Washington State Court of Appeals affirmed superior court rulings granting final approval to a class action settlement, denying a motion to consolidate six class action lawsuits, and approving a class notice plan. According to the opinion, in 2021, the U.S. Department of Health and Human Services notified the respondent company, a nonprofit organization serving low-income individuals, of a data breach that exposed the social security numbers of 163,499 individuals. In 2022, appellant filed a class action lawsuit against the respondent company, one of six such separate class action lawsuits. The appellant filed a motion to consolidate the six pending class action lawsuits, which was denied. Subsequently, plaintiffs in one of the class action lawsuits signed a settlement agreement and release that would release, discharge, and bar all claims asserted in the other class action lawsuits and provide compensation anywhere from $100 to $25,000 to impacted individuals. The appellant plaintiff then filed the instant appeal alleging that the lower court abused its discretion by denying her motion to consolidate the six actions, that the class action plan failed to provide reasonable notice, and that the settlement was not fair, reasonable, or adequate because “the settlement is the product of collusion between the settling parties.” The appellate court disagreed and ultimately upheld the lower court’s rulings.
On December 8, President Biden met with over 80 federal and state officials to discuss reducing medical debts for Americans. The Biden-Harris administration desires to address medical payment products, unfair debt collection practices, surprise billing and facility fees, and charity care. This roundtable was one of several actions taken by the administration to lower Americans’ healthcare costs, in addition to (i) the CFPB’s report on how medical debt collectors pursue debts under the FDCPA, such as through misattributed billing and billing consumers without contacting them (previously covered by InfoBytes, here); and (ii) the CFPB’s proposed rule to remove medical bills from credit reports (also previously covered by InfoBytes, here). The roundtable featured speakers from the president’s council, the CFPB, the Center for Medicare and Medicaid Services, DHHS, the Treasury, and representatives from California, Colorado, and Washington.
On July 11, CFPB Director Rohit Chopra delivered prepared remarks at a public hearing on medical billing and collections. Chopra commented on the prevalence of medical debt in the country, which affects over 100 million Americans, while $433.2 billion of the national GDP is sourced from consumers’ out-of-pocket expenses. Specifically, the CFPB hearing addressed the effects of medical payment products, including special-purpose credit cards and installment loans used to cover the cost of medical treatment, which Chopra claimed can leave patients “worse off.” The Bureau highlighted the predatory nature of such medical credit cards, which typically have a higher interest rate than other cards and are often presented to consumers by their providers. According to Chopra, the Bureau recently launched a public inquiry (covered by InfoBytes here) to answer questions related to these products.
During the expert panel discussion, multiple panelists raised issues regarding the federal requirements for hospital financial assistance programs that exist in exchange for tax benefits. Panelists criticized the complicated processes patients must follow for such programs and compared it to the simple and fast online application process for medical credit cards. Panelists also highlighted the need to include stronger, clearer federal requirements for hospital financial assistance programs, such as setting standards on income and setting minimums or floors, so consumers can access such services more easily. Panelists commonly noted that state requirements for hospital financial assistance programs are more robust than the federal requirements. In response to Chopra’s question on what the panelists wish to see from the Bureau regarding regulation, one panelist asked for a ban on deferred interest, noting the “special regulatory authority” the Bureau has. Another panelist requested that the agency ban medical credit cards from being offered in a medical setting, citing her communication with clients who claim they feel “pressured” to sign the paperwork in that setting. Additionally, another panelist requested that the Bureau prohibit the reporting of medical debt on credit reports—mentioning Colorado’s headway in being the first state to ban such reporting and noting the Bureau’s potential to ban it at a federal level. The panelists each applauded the agency’s efforts to bolster regulations on medical payment products.