Can You Get Medical Bills Off Your Credit Report?
Understand how medical bills impact your credit report and learn the updated methods to address and remove them effectively.
Medical bills appearing on a credit report can be a source of concern for many consumers. Historically, medical debt could significantly impact an individual’s financial standing, affecting access to credit or loans. However, recent adjustments in how credit bureaus handle this type of debt have altered the landscape. Understanding these changes and the avenues available for addressing medical debt on credit reports is important for consumers navigating their financial health.
Current Rules for Medical Debt Reporting
Significant changes to medical debt reporting policies were implemented by the three major credit bureaus: Equifax, Experian, and TransUnion. These changes began in July 2022 and continued into 2023, aiming to reduce the impact of medical bills on consumer credit reports. These adjustments have provided consumers with more flexibility and protection regarding medical debt.
As of July 1, 2022, paid medical collection debt is no longer included on consumer credit reports. This change applies to all medical collection debt that has been paid, regardless of the amount.
Additionally, the grace period before unpaid medical collection debt can appear on a credit report was extended from six months to one year. This extended timeframe allows consumers more opportunity to resolve billing issues with healthcare providers or insurance companies before the debt impacts their credit file.
Furthermore, starting in April 2023, medical collection debt with an initial reported balance under $500 is no longer included on credit reports. This threshold aims to remove smaller medical debts that often stem from unexpected circumstances. These combined measures are estimated to have removed a substantial percentage of medical collection debt from consumer credit files.
How to Check Your Credit Reports
Accessing your credit reports is an important initial step to determine if medical debt is present and accurately reported. Federal law provides individuals with the right to obtain a free copy of their credit report every 12 months from each of the three nationwide credit bureaus: Equifax, Experian, and TransUnion. The official website for this purpose is AnnualCreditReport.com.
To request your free reports online, you will need to provide personal identifying information, including your name, address, date of birth, and Social Security number. This information is used to verify your identity and ensure the security of your financial data. You can choose to request all three reports simultaneously or space them out throughout the year to monitor your credit more frequently.
Upon receiving your credit reports, carefully review each one for any entries related to medical debt. Look for accounts listed under “collections” or “charge-offs” that may indicate a medical provider or collection agency. Identify the original creditor, the collection agency, the amount owed, and the date the account was opened or reported. Discrepancies or unfamiliar accounts should be noted for further investigation. Checking all three reports is advisable because information may vary between bureaus.
Steps to Remove Medical Debt
Once credit reports have been reviewed, several steps can be taken to address medical debt. These actions leverage existing consumer protections and recent changes in reporting policies. The approach depends on whether the debt is inaccurate, eligible for automatic removal, or a valid, unpaid obligation.
If medical debt appearing on a credit report is inaccurate or should not be present, disputing the entry is a primary course of action. Inaccuracies can include debt that has already been paid, was never owed, or is a duplicate entry. Disputes can be filed directly with each credit bureau reporting the inaccurate information, online, by mail, or by phone. When filing a dispute, clearly explain the error and provide any supporting documentation, such as proof of payment or insurance explanation of benefits. Federal law requires credit bureaus to investigate disputes and remove unverifiable or incorrect debts within approximately 30 days.
For medical debt that should have been removed automatically under the new rules but remains on a report, additional action is necessary. This includes paid medical collection debt or unpaid medical debt under the $500 threshold. If such an item is still present, individuals should contact the credit bureau and provide proof that the debt qualifies for removal under current policies. This might involve submitting documentation of payment or demonstrating the original balance was below the exclusion threshold.
For valid, unpaid medical debt not eligible for automatic removal, limited options exist to facilitate its removal from a credit report. A “pay-for-delete” agreement, though not guaranteed, involves negotiating with a collection agency to remove the negative entry in exchange for payment of the debt, or a portion thereof. This strategy applies only to accounts already with a collection agency, as original creditors typically do not participate. If a collection agency agrees, obtain the agreement in writing before making any payment. Additionally, some medical providers offer financial assistance programs or hardship aid that could reduce or eliminate the debt, potentially leading to its removal from credit reports.