How Can Medical Debt Affect Your Credit Score

Credit Score
How Can Medical Debt Affect Your Credit Score


Healthcare is obviously an important part of staying healthy, but expensive medical bills can cause your finances to suffer. While some unpaid medical debts can negatively affect your credit score, since March 31, 2023, the credit reporting agencies no longer include medical bills under $500 in your credit report, so those bills won’t affect your credit score. Paid medical bills don’t appear on your credit reports at all, but bigger unpaid medical balances can cause a credit score to decrease. 

With all that being said, if you are struggling to pay off the bills, you can also opt for loans for medical bills. Here’s everything you should know about the kind of effects medical debt can have on your credit.

Can medical bills hurt your credit score?

Paid medical bills won’t affect your credit score. However, unpaid medical bills are handled a little differently than other consumer debts. Most healthcare providers don’t report directly to credit bureaus, so your debt would need to be sold to a collection agency before it can appear on your credit report. Most healthcare providers won’t sell your debt to a collection agency until you are 60, 90 or 120 days past your due date. Exactly when it happens, depends on your healthcare provider.

Even after your debt goes to collections, the bill won’t show up on your credit report instantly. The three main consumer credit bureaus, TransUnion, Experian, and Equifax, give you a 365 day or a year-long waiting period to pay off any unpaid medical bills before the account appears in your credit report. So the medical bills won’t impact your credit score right away if they are unpaid or ever as long as you pay them within a year. If the initially reported account balance is under $500, then the account won’t appear on your credit report and won’t affect your credit score.

Credit bureaus offer a grace period because medical bills are a delicate type of debt. Even if you have health insurance and the bill is for an insured expense, you may have to wait for months to get your insurance company to accept your request & issue the payment to the healthcare provider. A simple billing error can delay the payment process. The 365 day grace period gives you a little time to correct any errors and gives the insurance company’s payment system enough time to make the required payment.

Does paying off your medical bills improve your credit score?

It’s always best to pay off medical debts since when it comes to your credit scores, it can make a big impact. Unpaid medical collection accounts over $500 can appear on your credit reports and reduce your credit scores for up to 7 years. However, when you or your insurance agent pays off a medical bill that was already reported to the credit bureaus, the statement will be removed from your credit report. That can save you from a reduced credit score.


Medical bills are always a daunting thing to face while also dealing with the stress of having a loved one hospitalized. If you are struggling to pay the medical bills, you can also look up resources to help you handle it and avoid hurting your credit. Additionally, if you think there are any errors in your credit report, be sure to file for a dispute as soon as possible. We hope this helps you understand how unpaid medical bills can affect your credit score and how you can prevent that from happening.

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