Medical debt is probably the most frustrating type of debt to have show up on your credit report. It is usually totally unexpected, unlike other debts. It is unintentional, is usually expensive, and is tough to make the extra payment.
Well, relief is on the way – well, limited relief.
As of July 1st, 2022, paid off medical debt that went to collections will be removed from credit reports. As of the first half of 2023, unpaid medical debts of less than $500 will be removed from credit reports.
Of course, this won't help everybody. The credit reporting agencies contend that 70% of all medical debt will be removed. I seriously doubt that's going to happen. 70% is a very unrealistic number. To their credit, it is a step in the right direction.
So, if you have paid up medical debt that went to collections, take these steps.
Identify medical debts that should be removed - remember, it is any medical debt that went into collections and was paid off.
Identify other negative remarks that are a result of paid-off medical collections. Any of the research that I have done on these new rules addresses other remarks that can prove negative to your credit report and score. I would dispute those remarks as needing to be removed based on the intent of removing the debt that created the negative marks on your credit report.
The bottom line
If you had this type of debt, don't just assume it will be removed. Follow up and make sure! In addition, fight for the removal of any other negative remarks that are in conjunction with the paid-up medical debt. It defeats the purpose of removing only part of the negativity caused by the medical debt.