Credit Reporting Companies Introduce First Phase of Changes to Medical Collection Debt on Credit Reports

Earlier this month, Equifax, Experian, and TransUnion introduced the first phase of changes to medical debt that was announced earlier in the year. All medical collection debt that has been paid by the consumer in full will not be included on U.S. credit reports, effective July 1, 2022.

“We are dedicated to fostering the economic health of individuals and communities,” said Mark W. Begor, Brian Cassin, and Chris Cartwright, CEOs of Equifax, Experian, and TransUnion respectively. “Unexpected expenses, such as the cost of an unplanned medical visit, can be a hardship for many families. These changes will realign our approach to medical collection debt reporting in a manner that is designed to help consumers focus on their personal well-being.”

The first phase will give consumers one year to address medical debt before it appears on their credit report, instead of six months. These changes come before additional changes that will occur in the first half of 2023, most significantly the removal of medical collection debt from credit reports if the initial reported balance is less than $500.

Although most healthcare providers do not report directly to these agencies, the Nationwide Consumer Reporting Agencies (NCRAs) are making these changes to help consumers who have medical debt that has been sent to collection agencies.

Prior to these changes, if a healthcare provider reported a consumer’s overdue amount to a credit reporting agency for non-payment, the agency could report that information to the NCRAs after a six month period.