Can Medical Debt be Reported to Credit Reporting Agencies?
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Can Medical Debt be Reported to Credit Reporting Agencies?

The pain of medical procedures is too often magnified by the agony of out-of-control medical bills. As medical costs continue to rise - even for those with medical insurance - medical debt is becoming increasingly common.

Unfortunately, medical debt can be reported to credit reporting agencies, though this often depends on the nature of the debt and the practices of your health care provider. Once reported to a collection agency, creditors may take serious action against you, including lawsuits and wage garnishment.

However, a bankruptcy filing may clear your debts and put an end to creditor harassment. To learn about reducing your medical debt through personal bankruptcy, fill out the form below for a free consultation with a local attorney.


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How Medical Debt is Reported to Credit Agencies

If a medical debt of any amount goes unpaid the health care provider has the right to send the bill to a collection agency. This may lead to a legitimate mark on your credit report.

A frightening occurrence, however, is when a debt is simply being processed yet somehow still gets reported to a credit agency. This happens with an alarming degree of regularity.

According to a recent study by the Commonwealth Fund, a nonprofit research group, roughly 14 million Americans have had medical debts sent in error to credit agencies. This is a significantly higher number of errors than with other debts like car loans or credit card bills.

Why all these mistakes? Well, there are a few reasons for medical debt’s high rate of faulty reporting:

  • Hidden fees. It may be impossible for a patient to determine the exact cost of their care during a visit to the doctor. As a result, patients may not know exactly how much they owe until months after a debt may have been reported to a credit agency.
  • Insurance potholes. Often, medical bills get lost for months in the vast bureaucracies of medical insurance companies. If your insurance company does not pay a bill on time, even if they cover the expense, your credit report may still be negatively affected.
  • Collection agencies. Medical providers routinely send even small debts to collection agencies, which often turn around and immediately contact credit reporting companies.

Addressing Medical Debt on Your Credit Report

If medical debt is subject to so many errors, how can people prevent medical debt from falsely appearing on their credit report? A few strategies may help:

  • Credit check. Each year, you are entitled to a free credit report from the three main reporting agencies, Equifax, Experian, and TransUnion. Check your report each year for errors.
  • Speak with your doctor. When a bill is pending, always keep in touch with your medical provider’s office. They will usually be more willing to resolve a debt issue than a collection agency. For example, if they know your insurance agency is working on a solution they may hold off on sending a bill to collection.
  • Negotiate. If your bill has gone to a collection agency, they may be willing to remove the debt from your credit report if you make a lump sum payment.

These are all potential strategies for credit reporting mistakes. If, however, individuals are buried in medical debts they simply cannot pay, they often consider filing for personal bankruptcy.

Learn more about eliminating medical debt by contacting a local bankruptcy lawyer today.


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