What do doctors and dentists have in common with Wall Street lenders? Maybe more than you think.
Health professionals worry they could be regulated like bankers under that aims to clamp down on lending abuses.
One provision of a bill pending in Congress would give broad oversight to a new regulatory agency 鈥� the Consumer Financial Protection Agency 鈥� to make sure banks and other financial institutions don鈥檛 extend credit inappropriately.
That's where doctors, dentists and other health care providers start getting a little nervous.
Say you're an orthodontist and you'll let the Smiths pay Johnny's $5,000 braces' tab on the installment plan. Technically, you might be seen as a lender. And that label, some health care provider worry, might make them subject to the new consumer agency鈥檚 regulations.
Physicians and dentists see paperwork ahead -- and lots of it. Michael Graham, managing director of government affairs for the American Dental Association, says that it's not clear yet how bad things might be because the regulations haven't been written. But, one thing's for sure, complying would cost money.
As currently drafted, the bill would exempt sellers of nonfinancial goods and those not "engaged significantly" in lending. So the measure鈥檚 supporters say the bill doesn't apply to health care practitioners.
The , the and other some other groups maintain that because the legislation doesn't define "significantly,鈥� their members could eventually find themselves under CFPA鈥檚 watchful eye.
So, a letter from 23 health care trade groups , including the fact that committee report language directing that dentists expressly be exempt could create a situation where other health care professionals would be included by default.
The U.S. Chamber of Commerce includes this issue 鈥� as it might affect small businesses -- on a self-explanatory website, . The groups also have the support of Rep. Nydia Velazquez, chairwoman of the House Committee on Small Business, who sent .
Dodd, chairman of the Senate Banking Committee, said last week that claims by the Chamber that dentists and orthodontists would fall under the purview of the agency are just wrong. In a Dodd explained:
An orthodontist is not a significant financial player. If your orthodontist, or doctor, or dentist lets you pay your bill over a series of months, they鈥檙e not covered. If your local grocer or butcher keeps a tab and bills you at the end of the month, they鈥檙e not covered.
Nonetheless, Graham and others are working with Dodd to change the overhaul bill to make it clear doctors and dentists are exempt. 鈥淲e know Sen. Dodd meant it for financial institutions,鈥� Graham said. 鈥淕od bless him, but we don鈥檛 think it鈥檚 clear enough.鈥�
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