WASHINGTON — To protect consumers, several U.S. government agencies are working to make it easier for Americans to click the “unsubscribe” button for unwanted memberships and recurring payment services.
A new, broad-based government initiative called “Time is Money” includes the introduction of new regulations and the promise of more for sectors ranging from healthcare and gym memberships to media subscriptions.
“The administration is cracking down on all the ways that companies, through paperwork, wait times and general aggravation, are wasting people’s money and time and really holding onto their money,” White House domestic policy adviser Neera Tanden told reporters on Friday ahead of the announcement.
“Essentially, all of these practices are either delaying the delivery of services to you or making it so difficult for you to cancel the service that they can hold on to your money for longer and longer,” Tanden said. “These seemingly minor inconveniences don’t happen by accident — they have huge financial consequences.”
Among other things, a new investigation by the Federal Communications Commission will begin on Monday into whether requirements should be imposed on communications companies to make it as easy to cancel a subscription or service as it is to sign up for one.
The Federal Trade Commission Started March 2023 Click to cancel regulations require companies to let their customers end their subscription as easily as they started it.
Also on Monday, the heads of the Departments of Labor and Health and Human Services asked health insurers and group health plans to improve interactions between customers and their health insurers and “identify additional opportunities in the coming months to improve the interaction between consumers and the health care system,” according to a White House summary.
The government has already launched several initiatives to improve the consumer experience.
In October, the FTC announced proposed regulations to ban hidden and false nonsense costswhich can mask the total cost of concert tickets, hotel rooms and utilities.
In April, the Department of Transportation passed rules requiring airlines to automatically issue refunds for things like delayed flights and to provide better public disclosure baggage charges or cancellations of reservations.
The ministry has also taken action against individual companies accused of misleading customers.
In June, the Justice Department, referred by the FTC, has filed a lawsuit against software maker Adobe and two of its executives, Maninder Sawhney and David Wadhwani, for allegedly pushing consumers into the company’s “annual monthly paid” subscription without making it clear that canceling the subscription could cost hundreds of dollars in the first year.
Dana Rao, Adobe’s general counsel, said in an emailed statement that Adobe disagrees with the characterization of its company in the lawsuit and that “we will refute the FTC’s allegations in court.”
“Early termination fees have a minimal impact on our revenues, accounting for less than half a percent of our total revenues globally, but are an important part of our ability to offer customers a choice in plans that balance cost and liability,” Rao said.
Some business advocates are not in favor of the government’s general measures to tackle unwanted allowances.
Sean Heather, senior vice president of international regulatory and antitrust affairs at the U.S. Chamber of Commerce, said the initiative “is nothing more than an attempt to fine-tune companies’ pricing structures, often undermining companies’ ability to offer consumers options at different price points.”
