‘Time is money’: Government to make it easier to cancel memberships, recurring payments

The federal government is trying to make it easier for consumers to keep their money if they want to cancel subscriptions, submit health claims or get a real person on a customer service line.

The plan, introduced by the White House, is dubbed the “Time is money” initiative and builds upon the Federal Trade Commission’s “click to cancel” rule that was introduced in March 2023, The Associated Press reported.

The FCC wanted companies to allow customers to end subscriptions as easily as they were started.

“The new click to cancel provision, along with other proposals, would go a long way to rescuing consumers from seemingly never-ending struggles to cancel unwanted subscription payment plans for everything from cosmetics to newspapers to gym memberships,” the agency said last year.

“Some businesses too often trick consumers into paying for subscriptions they no longer want or didn’t sign up for in the first place,” FTC Chair Lina M. Khan at the time. “The proposed rule would require that companies make it as easy to cancel a subscription as it is to sign up for one. The proposal would save consumers time and money, and businesses that continued to use subscription tricks and traps would be subject to stiff penalties.”

Neera Tanden, a White House domestic policy advisor summed it up on Friday, “For example, you want to cancel your gym membership or subscription service or newspaper. It took one or two clicks to sign up. But now ... you have to go in person, or wait on hold for 20 minutes ... just to opt out,” CNBC reported.

But the plan goes further than just being able to easily cancel subscriptions.

The Labor and Health and Human Services departments are urging health insurance and health plans to make customer interactions better, the White House said.

The administration said it wants companies to make it easier to file a claim, instead of being forced to submit a paper claim, allowing people to file online, or instead of having extended wait times or short call center hours, to make them more accessible, so people don’t have to take time from work to deal with medical claims.

The White House also wants to curtail customer service “doom loops” where a person calls customer service and constantly gets bogged down in the menu or automated recordings. The Consumer Financial Protection Bureau is developing rules that will require a caller to get a human on the phone with the push of a single button. The FCC will look at similar rules for phone, broadband and cable companies, while the Labor and Health and Human Services agencies will work with health insurance companies.

The CFPB will examine how chatbots are used and determine if and when they’re unlawful, including when someone thinks they’re talking to a real person.

There will also be accountability for bad service. Marketers will not be allowed to use fake reviews, suppress negative reviews, or pay for positive reviews.

“In all of these practices, the companies are delaying services to you, or really trying to make it so difficult for you to cancel the service, that they get to hold on to your money for longer and longer,” Tanden said, according to CNBC.

Companies have pushed back on the proposals, saying that the government, specifically Democrats, are trying to over-regulate industry, Reuters reported. Former President Donald Trump, who is campaigning for reelection, has on his platform trying to take the regulatory burdens away from companies.

Finally, the administration will ensure that parents can communicate with their children’s schools with the Department of Education giving plans to streamline all of the paperwork, communication with teachers and other processes that can become time-consuming.

These initiatives, however, are the tip of the iceberg, and the administration is looking for more ways to make it easier for Americans can get their time back and has opened a portal to share ideas.

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