Do Medical Bills Affect Your Credit Score?

Among the myriad wonders of medical care in the United States, medical debt stands stubbornly as the one incurable malady.

Worse, left to fester like some ingrown hair, medical debt can debilitate your credit score.

From a Kaiser Family Foundation (KFF) survey published in February 2024: U.S. residents owe at least $220 billion in medical debt. Roughly 14 million people (6% of adults) owe more than $1,000 in medical bills, and about 3 million (1% of adults) are in the red by more than $10,000.

KFF found worrisome knock-on effects: Consumers sometimes turn to other forms of debt — payment plans, credit cards, personal loans — to settle medical debt, which can lead to problems of their own.

So, does medical debt affect your credit score? Yes, it can, but the impact is easing just a little.

In June 2022, the Big Three credit bureaus (Equifax, Experian, and TransUnion) began softening the impact of medical debt, removing paid debt from scores. At the same time, they paused reporting on medical bills until they were in collections for a year. In April 2023, they removed medical debt valued below $500.

The biggest news on the medical debt front, a push by the Consumer Financial Protection Bureau (CFPB) in the final days of the Biden administration to block all medical debt from landing on credit reports, was vacated by a Texas federal judge in July. In the interim, under President Trump, the CFPB reversed its position.

Wait. There’s more. Since 2023, 15 states — Delaware is the latest — have taken steps to prevent medical bill collections from hurting their residents’ credit scores.

In short, the situation is in flux. But on the medical debt front, a proactive consumer is a wise consumer.

Understanding Medical Debt and Credit Scores

On the upside, nearly 92% of Americans have some sort of health care coverage; nonetheless, medical bills remain a fact of life. Even gold-plated coverage with low deductibles and minor copayments leaves patients responsible for some portion of healthcare costs, which the National Institute of Health reports are among the most expensive in the world.

Failure to pay those bills in a timely manner can result in them tumbling into the hands of a medical debt collections agency. Left untended, those debts can swell into a serious credit score problem.

What Is Medical Debt?

Medical debt is any healthcare bill that goes unpaid. In April 2024, the CFPB reported 15 million Americans had unpaid medical bills totaling $49 billion on their credit reports, despite efforts by Congress (the No Surprises Act of 2020) and Experian, Equifax, and TransUnion to lessen the impact of medical debt on credit scores.

Medical bills come from any number of sources, including doctors and dentists, hospitals, emergency rooms, surgery centers, prescriptions, labs, imaging centers, even ambulance service providers. Serious medical debt can arise from injuries, unexpected procedures, complicated pregnancies and deliveries, prolonged illnesses, and lengthy hospital stays.

Making matters worse, major health setbacks often disrupt the patient’s ability to remain employed or continue to earn at his/her accustomed level. Insurance gaps also play a role in medical debt, as do out-of-network providers. Keep in mind, as well, that billing mistakes happen and claims sometimes get denied.

How Credit Scores Work

A credit score is a forecast of the likelihood you will pay your debts. It is based on your past financial activities. Companies use credit scores to determine whether to offer you a variety of credit products, including mortgages, auto loans, personal loans, or credit cards.

Your credit score is used to determine the interest rate you’ll be offered and your credit limit and can also be used for tenant screening and some forms of insurance.

The two largest compilers of credit scoring models are Fair Isaac Corporation (FICO) and VantageScore, a collaboration among the Big Three credit bureaus. The two use similar models, and weigh scores on a scale ranging from 300 (poor) to 850 (outstanding).

Factors that influence your credit score include:

• Bill-paying history
• Current unpaid debt
• The number and types of loan accounts
• Age of your credit accounts
• Percentage of available credit you’re using
• New applications for credit
• History of bad debt (whether you have collections, a foreclosure or repossession, or a bankruptcy)

Do Medical Bills Affect Your Credit Score?

Medical bills can affect your credit score, but only under specific conditions.

The bill from your provider issues you must remain unpaid long enough (usually 180 days) to go to a medical collections agency. And only if it remains unpaid after a year, and only if it is more than $500, will the debt be reported.

When all those dominoes fall against you, your credit score gets dinged.

How Medical Debt Gets on Your Credit Report

Unpaid medical debt won’t show up on your credit score as long as it stays with your medical care provider, usually for 180 days. Proactivity is the best inoculation: Review the bill for accuracy; contact your insurance company and medical care provider to resolve concerns or problems; stay on top of the situation until the bill is paid.

Once those 180 days elapse, however, your unpaid bill can be sent to a medical collections agency.

Now a fresh clock starts ticking. Rest assured, you will hear from the collections folks right away. (Maybe you just needed a reminder; it happens.) However, the agency must wait a year to report its unpaid status to the Big Three credit bureaus.

So, you have 11 months and 20-odd days to make, or arrange, payment before the unpaid bill slams into your credit report. Once it’s there and remains unpaid, however, it sticks like Dermabond to your credit report for seven years.

Grace Periods and Collection Practices

The Big Three credit reporting agencies adopted the grace period during 2022-2023 to give consumers time to address coding or billing errors, resolve and — fingers crossed — correct inaction by insurers, seek financial assistance, or set up a payment plan.

Under the Fair Debt Collection Practices Act, medical collections agencies cannot harass or abuse consumers; misrepresent who they are or how much debt is owed; make contact at unreasonable hours; or attempt to collect invalid debts.

In 2024, the CFPB toughened protections for medical debt. Collectors can be punished for collecting unsubstantiated debts; double billing; “upcoding,” or billing for pricier services than the consumer received; or exceeding legal limits on what can be charged for a service.

Distinction Between Medical and Non-Medical Collections

Medical debt is treated more leniently than other debt for a variety of reasons. Often, medical debt comes about via uncontrollable circumstances. Additionally, studies indicate, compared to traditional consumer debt — credit cards, personal loans, car loans, mortgages — medical debt is a less reliable gauge of a consumer’s creditworthiness.

Recent Changes to Medical Debt Reporting

A small, but significant revolution in medical debt reporting is afoot. We are in an age of unprecedented grace periods, debts expunged by payment and lighter penalties for unpaid medical bills. Equifax, Experian, and TransUnion are on board, urged on (to a degree) by the CFPB.

2022-2023 Credit Bureau Policy Changes

Beginning in 2022, the Big Three initiated its policy change to exclude medical debt with an original balance of under $500; prevent medical collections agencies from reporting unpaid debt for one year; and remove medical debt that has been paid.

CFPB’s 2025 Final Rule

In January 2025, the CFPB declared it would remove medical bills from Americans’ credit reports entirely, effective March 2025. The rule cited the federal banking and financial services watchdog’s 2014 research finding that medical debt was a poor indicator of whether a consumer would default on commercial loans.

In July 2025, a federal judge in Texas quashed the rule, siding with Cornerstone Credit Union League, which argued the CFPB had overshot its authority.

How Medical Debt Impacts Credit Today

Here’s where we are in 2025: Medical debt reporting on credit reports has evolved to become more consumer friendly. This comes as a welcome development for those most frequently in over their heads: Uninsured adults, women, Black and Hispanic adults, parents, and people with low incomes.

However, it remains a potential headache for those who cannot cure those debts.

A recap: Medical bills whose original balance met or exceeded $500 and remain unpaid a year after they were turned over to a medical collections agency, still can appear on credit reports for up to seven years.

Reported medical bills that are paid off, get expunged from consumers’ credit reports.

Protecting Your Credit from Medical Debt

To protect your credit from medical debt, use the tools at your disposal. Make sure the debt is yours, the total is accurate and that everyone along the billing chain has used the appropriate codes. Finally, investigate the availability of financial help for your medical bills.

Tips to Avoid Credit Impact

The responsibility for limiting the impact of medical bills on your credit score falls to you. Again, you have tools at your disposal:

• Review your bills for accuracy; if you’re unclear, ask your provider for verification and details; similarly, quiz your insurer; promptly dispute discrepancies.
• Ask your medical provider about agreeing to a payment plan.
• Monitor your credit reports for errors; Experian, TransUnion and Equifax are obliged to provide a free copy of your credit report once every 12 months.

What to Do If Medical Debt Is in Collections

If your medical debt slides into the clutches of a collections agency, there are additional steps you can take.

For instance, it’s still not too late to verify the charges and the accuracy of the billing with your provider and insurer. Ask your provider for an itemized bill, also known as a “superbill.” It will show each medical billing procedure code, what your insurance paid, and the amount you owe. You may yet discover errors in the process.

Furthermore, make certain the medical collections agency has the authority to take action on your debt. Ask for credentials.

If you are satisfied they are who they say they are and the debt is legitimate, ask the agency to provide a copy of your superbill. Some charges cannot be legally collected, among them errors in billing; services not received; overcharges; bills already paid by insurance or handled by financial assistance or charity care programs; or, in some states, debts that are several years old.

Debt collectors rarely admit that medical charges can be negotiated. They can. Ask for a reduction, what would they accept as full payment right now? Or propose a payoff number of your own.

If you’re nervous about engaging in this exchange on your own, there’s help for the asking. Patient advocates, medical billing advocates, and nonprofit credit counselors are skilled in the art of negotiating with medical collections agencies.

What This Means for Consumers

Reforms in recent years have alleviated some of the worst symptoms of medical debt; nonetheless, big medical bills remain a major stressor for millions of Americans.

To recap for those in deep holes of medical debt:

• Medical providers keep unpaid bills on their books for up to 180 days, giving patients a chance to verify and/or dispute, wait out insurers’ payments, and ask about payment plans.
• Medical collections agencies must properly identify themselves in writing; are restricted in the methods they can use; cannot report unpaid debts to the Big Three reporting agencies for a year; cannot report debts of less than $500; can and will negotiate; must report when medical debts are satisfied.
• The Big Three’s reforms include lessening the impact of medical debt on credit reports; will not accept reports of medical debt from collectors for a year; will expunge medical debt that has been paid off (even at a negotiated settlement).

All of these reforms cannot do for medical debtors what the CFPB had proposed: Eliminate medical debt from credit reports. Instead, it still falls to consumer-patients or their financial advocates to remain vigilant and proactive regarding their credit scores and medical care bill management.

FAQs

Do Medical Bills Go on Your Credit Report Immediately?

Medical bills must go unpaid for 18 months before they bruise your credit report. In most cases, providers keep bills on their books 180 days before they’re transferred to medical debt collectors; the collectors must wait one year before reporting the debt to the Big Three.

How Long Does Medical Debt Stay on Your Credit Report?

Once it hits your credit report, medical debt remains until it is paid, or seven years.

Can You Remove Medical Debt from Your Credit Report?

Medical debt can be removed from credit reports in several ways: Pay it off in full; negotiate a reduced payment accepted as payment in full; successfully dispute the debt.

Does Paying Off Medical Debt Improve Your Score?

In announcing its rule (since reversed by a U.S. federal court) erasing medical debt from credit reports, the CFPB estimated the average credit score affected by the change would rise 20 points. You can expect a favorable bump in your credit score by paying off medical debt, your mileage may vary.

How Do Medical Bills Affect Your Credit

Unpaid medical bills can harm your credit. However, reforms noted above are lessening the impact.

Even so, it remains paramount that consumers be alert. Understand your rights as a consumer; stay informed regarding updates to medical debt reforms; and if you’re feeling overwhelmed, consider enlisting outside help, from patient and medical bill advocates to nonprofit credit counselors.

Begin by checking your credit report. Dispute inaccuracies. Errors happen, and they can be corrected. Get a free copy of your report from one of the Big Three today, another in four months, and another four months later. Keep that habit indefinitely, so you’re always up to date.