The 2023 Changes
Starting in 2023, the three major credit bureaus (Equifax, Experian, TransUnion) implemented major changes: (1) Paid medical collections are removed from credit reports. (2) Unpaid medical collections under $500 are excluded. (3) New medical collections do not appear until one year after the first delinquency (up from 6 months). These changes removed an estimated 70% of medical collections from credit reports.
What Still Appears
Unpaid medical collections over $500 that are more than one year old still appear on credit reports. Medical debt that has progressed to a court judgment still appears. Non-collection medical accounts (like a medical credit card or medical personal loan) are reported normally. If you charged medical expenses on a regular credit card, that is credit card debt, not medical debt, for reporting purposes.
Impact on Credit Scores
FICO 9 and VantageScore 4.0 exclude paid medical collections from score calculations entirely. FICO 10 and FICO 10T also reduce the impact of medical collections. Older scoring models (still used by some lenders) may still count medical collections. The net effect: medical debt has significantly less impact on credit scores than it did before 2023.
Disputing Medical Debt on Your Credit Report
Check all three credit reports at annualcreditreport.com. If you find medical collections that should have been removed (paid, under $500, or less than one year old), dispute them directly with each bureau. The bureau has 30 days to investigate and respond. If the debt is inaccurate or cannot be verified, it must be removed. Include documentation (payment receipts, hospital records).
Frequently Asked Questions
Will medical debt affect my ability to get a mortgage?
The impact is significantly reduced under new rules. FHFA (which oversees Fannie Mae and Freddie Mac) announced that medical collections will not be considered in mortgage underwriting. VA and FHA loans also have favorable treatment of medical debt.
Can a hospital report medical debt immediately?
No. Under the new rules, medical collections cannot appear on credit reports until at least one year after the first delinquency. This gives you a full year to negotiate, apply for charity care, or set up a payment plan without credit damage.
Does this apply to medical credit cards like CareCredit?
No. Medical credit cards are reported as regular credit card accounts, not medical debt. The medical debt protections only apply to direct medical bills and medical collections.
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