Consider This from NPR - The plan to tackle customer service bots and subscription fatigue

Episode Date: August 13, 2024

This week, the Biden administration announced it is taking on more of what it calls "everyday headaches and hassles that waste Americans' time and money."And it's doing that by having federal agencies make new business rules. There are actions to simplify health insurance paperwork, crack down on fake product reviews, streamline parent-teacher communications in schools and circumvent those automated customer service calls that the White House labels "doom loops."It's all part of a wider economic mission to eliminate modern business practices that the Biden administration believes exploit Americans.Neera Tanden, the director of the White House Domestic Policy Council, breaks down why this is happening and how it will work in reality.For sponsor-free episodes of Consider This, sign up for Consider This+ via Apple Podcasts or at plus.npr.org.Email us at [e-mail] more about sponsor message choices: podcastchoices.com/adchoicesNPR Privacy Policy

When you have to call a customer service line, where's your patience at on a scale of, say, 1 to 10? Most people start at a 9 or 9 and a half. But then you start this interaction and you're met with an automated system, right? Press 1, press 2. Amastanuma wrote a book called Waiting for Service about why this experience is broken. And he says if you manage to get past the automated system and reach a human, at this point, you are at like a four. And then by the time they transfer you to another operator and you repeat all your information, your grace has worn thin.

You are at a zero and lots of people are in the negative. Well, this week, the Biden administration announced it is taking on more of what it calls everyday headaches and hassles that waste Americans' time and money, meaning federal agencies are making new business rules. So the Federal Trade Commission is trying to require that it be easy to cancel a subscription. The Department of Transportation is set to require automatic cash refunds for canceled flights. There are actions to simplify health insurance paperwork, prohibit fake product reviews, streamline parent-teacher communications in schools, and, yes, circumvent those automated customer service doom loops.

If this sounds familiar, it's because the Biden administration has been steadily working on what it calls a pro-consumer agenda. I'm also getting rid of junk fees, those hidden fees at the end of your bill that are there without your knowledge. In a State of the Union address, President Biden mentioned his fight against hidden or surprise surcharges for a second straight year. And I'm saving American families $20 billion a year with all the junk fees I'm eliminating. Consider this. The White House describes its crackdown on these business practices as protection for the American consumer. But can it really improve customer service? From NPR, I'm Ari Shapiro.

It's Consider This from NPR. Neera Tanden wanted to cancel a newspaper subscription. She was on hold for 45 minutes. And then after the 45 minutes, it was five minutes of the person trying to negotiate with me, not actually canceling the subscription. So I literally had to say three times. Tandon says she had the time and wherewithal to go through with that. Relatively speaking, anyway, she is director of the White House Domestic Policy Council. But she really feels for those who can't run that customer service gauntlet. You're a single mom with two kids. Your time at home is precious. When you're at home, you have to take care of your kids. You can't really be on the phone for 45 minutes just waiting.

I spoke with Neera Tanden about this collection of new federal consumer protection rules. Customer service doom loops are just one small part of this new initiative. The White House is calling this collection of new rules time is money and you make lots of promises here. The White House says it'll be easier to get refunds, cancel subscriptions, talk to a human. How do you actually make the private sector go along with these plans? Well, the Consumer Financial Protection Bureau is engaging in a rulemaking process, which will basically create rules of the road. And we see many ways in which companies are wasting both people's time and their money with practices that are really designed to ensure that the company is able to hold on to

your money more. And so basically the way that it will work is that the FCC will put out rulemaking that says that the companies are supposed to say, for example, make it as easy to cancel a subscription as it is to get a subscription. So a good example to me is, you know, when you're doing a subscription, a streaming service, or a cell phone service, if it's, you know, one or two clicks to get the service, it should be one or two clicks to get rid of the service. What is excessive and what is reasonable is ultimately in the eye of the beholder, right? So if a bank wants to steer a customer to the right person by providing a menu of options on the phone, is it really the federal government's role to say that is a waste of

people's time? So I want to be really clear here. There's nothing here that says you can't have a chatbot. We're just saying, you know, you should be able to get to a human, you know, press a button, zero, and get to a human quickly. The Chamber of Commerce, which represents many different companies across many different sectors, objects to these proposals. Sean Heather from the Chamber called it, quote, an attempt to micromanage businesses' pricing structures, often undermining businesses' ability to give consumers options at different price points. How do you respond to that? I would say that fundamentally, we think that this should be a baseline consumer protection. I think what I would say to the chamber is that we've heard from companies, we've heard from companies in the healthcare field who want to, you know, get rid of these crazy billing systems where you have to do things via fax or

do everything via, you know, print out the paperwork, you know, fill it all out and then send it in. Those are practices that are really designed to waste a lot of people's time. And we've actually heard from insurance companies that would like to get rid of those practices, but they worry that if they're a good actor, that other companies will hold onto consumers in a way that basically makes them lose money. So these are baseline rules of the road that we think actually reflect a well-functioning market. If your business model relies on trapping people into services they no longer need, that's a reflection on how you're not competitive and you're not giving a good service. And companies should compete on services, not on hurdles. These proposals also build on the

White House's effort to get rid of hidden fees. And I'm curious about the definition, because I recently stated a hotel that added a resort fee, which included, among other things, Wi-Fi and the use of board games in the lobby. And the hotel said, I was not being charged a hidden fee. I was paying for specific services like Wi-Fi and board games. So are the definitions inevitably murky here? Well, what we're really saying is that fees like that need to be upfront. You need to be able to see those fees. Those fees need to be transparent to you when you are making a decision on a hotel. The president calls these practices really making a sucker out of people is when you sign up for a

hotel, you think this is the price you're paying. And then later on, they tell you there's a resort fee. If you knew that upfront, you would have just added that cost to the cost of the hotel. And then another competitor didn't have that resort fee, you might have gone there. Because we know that actually what consumers do is that they really just look at the price of the good. And when there's a hidden fee like that, it's kind of a way that some of these companies are really false advertising what the price of their good is. And that's what's wrong. That was Neera Tanden, domestic policy advisor to President Biden. This episode was produced by Megan Lim and Elena Burnett. It was edited by Patrick Jaron-Watanan and Sarah Handel. Our executive producer is Sammy Yenigan. And one

more thing, you can now enjoy the Consider This newsletter. We still help you break down a major story of the day, but you'll also get to know our producers and hosts and some moments of joy from the All Things Considered team. You can sign up at npr.org slash consider this newsletter. It's Consider This from NPR.