Paid Medical Bills Still on Your Credit Report? Here’s What You Need to Know

| Tedis Baboumian |

Paid Medical Bills Still on Your Credit Report?

Health problems can occur unexpectedly. They can be scary, and they may affect your ability to work. If that happens, it won’t take long before medical bills can have an impact on your overall financial picture.

Up until now, a single medical bill that you paid late could stay on your credit for up to seven years, continually impacting your credit score during that time. Even if you paid the bill off late, it’s still damaging your credit score. Are paid medical bills still on your credit report? Some upcoming changes may help.

Changes to Medical Bills on Credit Reports

Recently, the three major credit bureaus (Experian, Equifax, and TransUnion) issued a joint statement that there would be significant changes to credit reporting, namely medical collection debt that’s shown on a credit report. This change is being made to support consumers facing unexpected medical bills.

Months of industry research revealed that two out of three medically related debts are triggered by a single incident or a short-term medical problem. Thousands of consumers have experienced this type of impact on their credit score over an isolated incident.

The Impact of the Pandemic

Part of the reason for the change is related to the COVID-19 pandemic, which has been a factor affecting people’s health and their finances for two years. The pandemic triggered a detailed review of the frequency of medical collection debt showing on credit reports, and the bureaus recognized that a new approach was needed to help people focus on their health and recovery.

Upcoming Changes

The changes go into effect on July 1, 2022. Starting on that date, paid medical collection debt won’t be included on consumer credit reports. In addition, unpaid medical collection debt won’t show up on credit reports for up to twelve months (instead of just six). This grace period will give consumers more time to work with healthcare providers and insurance companies to resolve payment terms before the collection even shows up on a credit report.

Lastly, for the first half of 2023, the bureaus will refrain from reporting medical collection debt that’s under $500 — good news for consumers facing a short-term medical collection problem.

Checking Your Credit Report

It’s important to review your credit reports to see if a paid medical collection is on your reports. If there is any type of error, it needs to be disputed right away. Errors on credit reports are surprisingly common and to protect your credit, you need to make sure there are not any errors bringing down your score. After July, make sure that any paid medical collection debt that has been on your credit report is removed.

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