Medical Debt and Credit Reports: New Rules You Need to Know

Medical debt has been treated differently on credit reports starting in 2023, providing significant relief for millions of Americans. Here's what you need to know about the changes.

The Changes

What's No Longer Reported

• Paid medical collections - As of July 2022, paid medical debt no longer appears on credit reports
• Small medical debt - Collections under $500 are no longer reported (as of April 2023)
• Longer grace period - Medical debt must be 12 months old before it can be reported (increased from 6 months)

What This Means for You

If you have paid medical collections on your credit report, they should have been removed automatically. Check your reports to confirm.

Why This Matters

Medical debt is unique because:

• Often results from emergencies, not irresponsibility
• Complex billing creates confusion and errors
• Insurance complications cause delays
• Many people don't know they owe until collections

The changes recognize that medical debt shouldn't penalize consumers the same way as other debts.

Upcoming Changes

Additional changes are expected, including:

• Further reduction in what medical debt can be reported
• More protections for consumers disputing medical bills
• Better billing transparency from providers

If You Have Medical Debt

Step 1: Verify the Debt

Request an itemized bill and verify:

• The services were provided
• Insurance was billed correctly
• The amount is accurate

Step 2: Negotiate

• Ask about financial assistance programs
• Request a payment plan
• Negotiate for a lower settlement amount

Step 3: Check Your Credit Reports

• Verify paid debts have been removed
• Dispute any inaccurate medical collections
• Document everything

Important Timeline

• 0-12 months - Cannot be reported to credit bureaus
• 12+ months, under $500 - Cannot be reported
• 12+ months, over $500 - Can be reported
• When paid - Must be removed from reports

Getting Help

If medical debt is affecting your credit and you believe it shouldn't be, or if you're struggling to resolve medical billing issues, professional help may be beneficial.