By Consumers for Quality Care, on March 23, 2022
With roughly 1 in 5 U.S. households carrying some debt related to health care, accounting for the largest source of personal debt in the country, CBS News reports that the top three credit reporting agencies plan to drop most medical debt from consumers’ credit reports starting this summer.
Equifax, Experian, and TransUnion announced they are making several changes to the way they handle medical debt on credit reports. Lenders use credit reports to determine whether a consumer is a good bet for a loan, which could make it harder for those in medical debt to be approved for a mortgage, car loan, or other products. Credit reports can also affect people’s ability to rent an apartment and even get a job.
Some of the changes credit reporting agencies will implement include: dropping paid medical debt from a consumers’ credit report; increasing the time period before unpaid medical debts in collections will appear on a credit report from 6 months to 1 year; and dropping medical collection debt under $500 from credit reports.
Medical debt should not hamper consumers from living their lives. CQC applauds these efforts and urges more collaboration from both public and private entities to continue to find ways to address the burden of medical debt on millions of Americans.