Credit Reporting of Medical Bills

Medical bills are not like your regular credit accounts. There are certain situations that dictate if an account will be reported to a credit reporting agency. If you suspect you have accounts that were reported to the credit bureaus, but should not have been, you may want to contact the credit reporting agencies and put in a dispute. This should be done in writing. They will take the correct steps to investigate your claim.

Credit Reporting

When you have a medical bill that falls past due, there is a chance that it will be reported to one of the three, or all, credit reporting agencies. Only members of the credit reporting agencies are allowed to report information. Sometimes, smaller organizations such as hospitals or doctors don't join any of the credit reporting agencies because it is too costly. If they turn your account over to a collection agency, then the agency will report it to a credit report agency--TransUnion, Equifax or Experian.

Payments

Any medical bills you have outstanding, which you are making payments on, will not be reported to a credit reporting agency or turned over to a collection agency. These accounts are unlike your standard credit accounts, which are reported to the credit reporting agencies monthly. Most consumers will pay a small portion every month toward outstanding medical bills to keep them from becoming collection items.

Time Frame

When medical bills are reported to a credit reporting agency, the information remains for approximately seven years. Your credit score can be reduced. The amount of the reduction can vary from person to person. If you have been on file with the credit reporting agency for a long time and you have other accounts you pay on time, the effect may only be minimal. Order a copy of your credit report to review the information and see what has been reported.

Credit Removal

If you decide to pay your medical bills in full, the information will still remain on your credit report if the seven year time limit has not passed. The accounts will show as a "paid collection" account. Before you decide to pay off your medical bills, contact the collection agency and try to have the information removed once it is paid in full. You may be able to use your payment as a bargaining tool with the agency. Any agreements you reach should be put in writing by the collection agency before you send your payment. Some collection agencies will agree to remove the information only to renege after the payment has been received. Having written correspondence will confirm your agreement.

Automatic Erasure

Medical bills that have been on your credit file for seven years should drop off automatically. This does not always happen, and you may have to take the appropriate actions, such as contacting the credit reporting agency, to have the information taken off.