Millions and millions of Americans deal with medical debts that they can’t afford/ignore to pay and they end up on their credit reports. More than 50% of the reported collection accounts are medical, according to statistics. Our health isn’t something that we can put aside until the right moment. Medical related problems have to be dealt with right away even if oftentimes that also means dealing with overwhelming expenses and accumulating debts.
Even though the three major credit bureaus brought some changes to the timeframe in which people can pay any remaining medical debts and set a grace period of 6 months (180 days), there are a lot of unfortunate ones who still fail to meet the deadline and end up with ‘past due’ debts on their credit reports. Others just ignore the bills, being unaware of the consequences of their non-action.
Unpaid medical bills can become consumers’ worst nightmare. Collection agencies will hunt you down every each way they can and make your life a living hell and your credit score will obviously be affected dramatically. It will take about 7 years for your collection accounts to disappear from your report.
One way to get rid of the medical debt on your report is for it to be paid by your health insurer. But even so, depending on the credit scoring model they rely on, some lenders will take into consideration collections accounts even if they are paid.
That is why is of paramount importance to make sure you deal with your medical bills as responsible as you can and make sure they don’t end up on your credit report. The new grace period of 180 days should be of some help. Make sure you communicate with your health insurance provider and find out if they are paying your bills or not. A lot of the medical bills that appear on credit reports end up there simply because people trust their insurer and don’t investigate whether they paid them or not.
If your health insurance can’t help you, you can still try to negotiate your medical debts and bring them down. Whatever you succeed in obtaining, make sure to get it in writing. It’s the only way it will hold in court, should you need it someday. If you manage to make a deal with your medical provider, establish a payment plan and stick to it.
If you do have a medical bill on your credit report and you manage to pay it in full, make sure it is deleted from your report once you dealt with it. Although that won’t help your score entirely, at least it will mitigate the unwanted effects and collection agencies won’t harass you anymore.
If, as far as you are concerned, your medical bills are paid and things should look OK on your report but you still find inaccurate items in it, make sure you check everything for errors or possible ID theft. Learn how to dispute any inaccurate items and don’t delay anything.