The United States can be a cruel place for people with bad or no health insurance: One medical crisis could result in thousands of dollars of debt. But the Consumer Financial Protection Bureau (CFPB) and the federal government want to help some people avoid having their credit destroyed by medical debt by making sure paid medical debts are completely removed from credit reports, removing all medical collections under $500, and temporarily removing all debts less than a year old.
The CFPB reports that one in five households in the United States have some form of overdue medical debt, which appears on their credit records. Having bad credit can impact your ability to get employment and housing, as is the case for the millions of Americans with overdue medical debt. However, there are steps you can take to make sure these debts are no longer affecting your credit.
How to check your own report
Table of Contents
The new changes from the nationwide credit reporting companies include all medical bills reported by debt collectors. The first thing you should do is check if you have any outstanding medical bills on your credit report. You can still get a free, weekly online credit report through AnnualCreditReport.com. Just follow these steps.
These are the three things you want to keep an eye on when checking your credit report, per the CFPB:
- If you previously had a medical collection under $500, a paid medical collection, or a collection less than a year old on your credit report, check to make sure they no longer appear on your reports. Be aware, however, that this doesn’t include credit card collections, even if you used your credit card to pay for a medical expense under $500.
- Also, while you’re looking at your reports, check for any other information that might be inaccurate.
- If you find a medical collection under $500, a paid medical collection, a collection less than a year old, or errors on your report, you can dispute that information with the credit reporting company.
Before these recent changes, unpaid medical bills would show up on your credit report anywhere between 60 to 120 days. Credit reporting companies now wait a year from the time you saw the doctor before the debt will appear on your credit report.
What can you do if you still have debt affecting your score?
First, you should also know your rights. The No Surprises Act, which went into effect last January, protects Americans from certain unexpected medical bills. This includes surprise medical bills for emergency services from out-of-network providers. The act also protects you from debt collectors and consumer credit reporting companies, like Equifax, Experian, and TransUnion, from collecting, furnishing, or reporting on invalid medical debt.
If you find discrepancies on your credit report involving paid or invalid medical bills, or if you’re having problems disputing medical bill errors with a credit reporting company, submit a complain to the CFPB.
There are also programs to help you pay your medical bill debt if you are having financial struggles.