Does medical debt affect your credit score?
As of 2025, paid medical debt no longer affects your credit score, but unpaid medical debt may still impact it
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Medical debt is often unexpected and overwhelming. Before 2025, it could hurt your credit score and make it harder to qualify for a mortgage or other loans.
A recent ruling by the Consumer Financial Protection Bureau (CFPB) now prevents medical debts from appearing on your credit report, significantly improving your credit score and creditworthiness.
As of Jan. 7, 2025, medical debt will no longer be reflected on your credit report due to a new CFPB ruling.
Jump to insightMedical debts used to hurt your credit score and stay on your credit report for up to seven years.
Jump to insightMedical debts that go to collections can no longer hurt your credit score, and debt collectors cannot threaten to report your medical debt to major credit bureaus.
Jump to insightHow medical debt affects credit scores
When you go to the doctor or have an emergency room visit, you’re usually covered by your medical insurance plan. But most plans don’t cover 100% of your medical expenses — and you may be on the hook for medical bills.
When you can’t afford to repay your medical bills, they may be sold off to collections agencies. These agencies will try to collect on your debts. Before Jan. 7, 2025, these debts would be reported on your credit profile.
Recent changes in 2025
As of January 2025, a new CFPB ruling removes all medical debts from U.S. credit reports. This is the final step in a series of changes to help consumers protect their credit in the wake of mounting and unexpected medical debts. In April 2023, the Nationwide Credit Reporting Agencies (NCRAs) — Experian, Equifax and Transunion — removed all medical debts under $500 that were in collections from credit reports. This new ruling now removes all medical debts from credit reports — including from credit score issuers FICO and VantageScore.
While this law was recently passed, it may take up to 60 days after it was published in the Federal Register to take effect. The update was published on Jan. 14, 2025, so it may take a little while for it to start reflecting on your credit report.
Protections for consumers against medical debt
Medical bills can be confusing, and some providers send unpaid balances to collections quickly. Luckily, there are protections for people who find themselves in medical debt they cannot afford.
First, the recent CFPB ruling in January 2025 removes medical debt from being reported on your credit report. This can help protect your credit score and increase your chances of getting a loan like a home mortgage.
In addition, the Fair Debt Collection Practices Act (FDCPA) protects you in a few ways when it comes to debt collectors:
- Harassment protection: Debt collectors cannot threaten violence, use profanity or publish lists of people who don’t pay.
- No late-night calls: Collectors cannot call you at unreasonable hours or at your workplace.
- Truth in collections: They cannot lie about your debt, impersonate a lawyer or police officer or threaten arrest.
- Proof requirement: If you request verification, they must provide proof of the debt within five days.
The Fair Credit Reporting Act (FCRA) also protects your credit and gives you the right to dispute your debts. Debt collectors must provide proof of your debt, and if you don’t agree with it, you can ask your creditor to remove the debt from your credit report. If they don’t follow through, you can contact the three major credit bureaus and ask them to remove the debts using a 609 dispute letter.
Even though medical debts are supposed to be removed from your credit report and not have an impact on your credit score going forward — it may be a good idea to pull your credit report to make sure medical debts are no longer on your report.
Strategies to manage or prevent medical debt
Medical debt can put a strain on your finances, but there are several ways to reduce or prevent medical debt from accumulating in the first place.
Get the right medical insurance
Having the right type and amount of medical insurance coverage can help you avoid major medical debt. While many people can get discounted group medical insurance plans at their workplace, you may need to find a health insurance plan through your state’s health insurance marketplace.
It’s important to review the details of your policy, including what’s covered, what’s not covered and your deductible amounts for different types of procedures. And you’ll want to know what percentage of your medical bills are covered — and what percentage is your responsibility.
Negotiate your bills lower
Most medical providers will offer discounts on your bills if you pay them in full. Some may even offer discounted bills if you set up a payment plan to pay off your debts. While you might not get a discount, you won’t know unless you ask.
Set up a payment plan
If you can’t afford to pay off your medical bills in full, many providers offer payment plans that don’t charge any interest. There are also medical credit cards that offer 0% interest for a specified amount of time (such as 24 months). It’s important to make regular, on-time payments on your medical bills to avoid costly fees and potential interest charges in the future.
Consider charity care
If you don’t have the money for a medical procedure — or have a medical emergency that’s not 100% covered by insurance — you may qualify for charity care. Many hospitals and medical facilities have charity programs for disadvantaged patients. If you qualify (eligibility is usually based on your income and savings), the program may help you cover some (or all) of your medical expenses for that facility.
Debt relief
If you need help managing overwhelming medical bills, you may want to work with a debt relief company. These companies negotiate with your creditors, can lower your bill amounts, and set you up with a single monthly payment. You end up paying the debt relief company, and in turn, they pay each of your creditors.
FAQ
What is medical debt?
Medical debt results when an individual receives medical care but does not have the funds to pay for medical expenses in full. That medical debt often results from circumstances beyond a person’s control makes it unlike many other types of bills.
For example, no one makes the decision to have a heart attack that requires emergency surgery and results in tens of thousands of dollars in unexpected medical bills. Yet, often, without any warning, you can easily be burdened with considerable debts you cannot afford to repay.
Is medical debt considered in credit scores immediately?
As of Jan. 7, 2025, medical debt is no longer considered by credit rating agencies. Medical debts will also no longer be reflected on your credit report for the major credit bureaus, including TransUnion, Experian and Equifax.
Are there any ways to dispute medical debts on credit reports?
Now that the Consumer Financial Protection Bureau (CFPB) has banned medical debts from your credit report, the major credit bureaus will be removing your medical debt history from your credit report. It’s still a good idea to check your report to make sure there are no medical debts still being reported. If you find any, you can contact each credit bureau directly to dispute the report.
How long does medical debt stay on your credit report?
Before the recent ruling by the CFPB to remove medical debts from all credit reports, medical debt used to stay on your report for up to seven years. Now, medical debts will no longer be added to your credit report and won’t affect your credit score.
Are medical debt relief programs worth it?
Medical debt relief programs can be worth it if you’re struggling to keep up with your medical bills. A debt relief company will negotiate with your medical providers, come up with a payment plan you can afford, and help you pay off your debts quicker. But you’ll need to consider the fees and whether or not your medical provider will work with a debt relief company before signing up.
Article sources
ConsumerAffairs writers primarily rely on government data, industry experts and original research from other reputable publications to inform their work. Specific sources for this article include:
- Consumer Financial Protection Bureau, “CFPB Finalizes Rule to Remove Medical Bills from Credit Reports.” Accessed Jan. 16, 2025.
- Consumer Financial Protection Bureau, “Have medical debt? Anything already paid or under $500 should no longer be on your credit report.” Accessed Jan. 16, 2025.
- Consumer Financial Protection Bureau, “Fair Debt Collection Practices Act.” Accessed Jan. 16, 2025.
