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How to Get Medical Debt Off Your Credit Report in 5 Steps



When a medical bill goes unpaid for an extended period of time, it can make its way onto your credit report. If collections of any kind appear on your credit report, that can drag your credit score down

There’s some good news though. The rules surrounding medical debt reporting are changing in 2022 and 2023. And the changes are in favor of consumer credit reports. Medical debt collectors must now wait one year before an unpaid bill is added to your credit report. And starting in 2023, all unpaid medical debt of less than $500 won’t appear on your credit report at all. 

If you have a medical bill in collections, here’s how to remove it from your credit report. 


How to Get Medical Debt Off Your Credit Report

An unexpected illness or injury can quickly lead to mounting medical costs. Without an emergency fund, it’s easy to fall into medical debt. 

Unfortunately, medical debt is a relatively common problem that has led to an estimated $81 billion to $140 billion in debt for American households, according to the Consumer Financial Protection Bureau (CFPB). 

If your medical debt appears on your credit report, try these strategies to get it removed. 

1. Know Your Rights

There’s no denying that paying for medical care is confusing. In the past, it was easy for a medical bill to pop up seemingly out of nowhere. But the recent No Surprises Act offers new safeguards for those seeking medical care. 

The new rules are specifically designed to limit excessive surprise out-of-pocket costs. Here’s what the No Surprises Act restricts:

  • No surprise bills for emergency services
  • No out-of-network cost-sharing for emergency and nonemergency services
  • No out-of-network charges and balance bills for supplement care by an out-of-network provider at an in-network facility

Perhaps most importantly, healthcare providers and facilities are now required to give you a straightforward notice of your out-of-network care costs and information on how to avoid surprise bills. 

2. File a Dispute

As with all information on your credit report, you have the option to file a dispute if the details of your medical debt are incorrect. 

For example, let’s say that an old medical debt remains on your credit report even though you paid off the debt months ago. At that point, it’s time to file a dispute to fix the error

1. Gather Documentation

When filing a dispute, you need evidence to back up your claim. Otherwise, credit bureaus won’t voluntarily remove medical debt information. 

If you already paid the bill, gather documents to support this fact. Some documents that could work include a canceled check or your credit card statements. Additionally, you could reach out to the medical provider for a copy of their payment records. 

2. Send a Dispute Letter

It’s now time to send a dispute letter to any and all of the three major credit bureaus — Equifax, Experian, and TransUnion — where the medical debt appears on your report. You can send a physical letter or fill out the appropriate online form. 

Regardless of the dispute method you choose, you must provide the following information:

  • Your name and birthday
  • Your Social Security Number
  • A copy of a government-issued ID
  • Information about the dispute, including documentation of paying the bill

When you send the letter, keep a copy of the information for your records. 

3. Follow Up

Credit bureaus are required by the Fair Credit Reporting Act to respond to your dispute request within 30 days. In some cases, the credit bureau will ask you to provide additional information about your dispute. 

Although it may take some back and forth, you should have your answer within a few weeks. If the credit bureau agrees that the medical item on your report is a mistake, it will be removed. 

4. Check Your Credit Report

After your dispute has been resolved, check your credit report to make sure the negative information has been removed. You get one free credit report each year from each of the major credit bureaus. 

You can get your free credit report.at AnnualCreditReport.com, the official government-approved website. Review it carefully to confirm that the medical collection debt will be gone. If not, you can reach out to the credit reporting agencies again to clarify the issue. 

3. Ask Your Health Insurance Company to Pay for It

Before you receive medical care, understanding what your insurance company will and will not pay for is critical. If possible, work with your insurance company ahead of time to determine how much you’ll pay out-of-pocket. 

After you receive a bill, examine it with a fine tooth comb. Wade through the billing documents and your insurance policy details to confirm that the insurance company paid the appropriate amount, if they were required to pay anything at all. 

If you find a discrepancy between what the insurance company should have paid versus what they actually paid, reach out to the insurer. With the right information brought to their attention, they might be able to pay the bill. You might need to file a health insurance claim to make it official, however.

4. Pay Off Your Medical Debt

One way to remove medical debt in collections from your credit report is to pay it off entirely. Paid medical collections no longer appear on your credit report. 

This is easier said than done if you don’t have enough money saved up. If you can’t pay off the whole bill, try negotiating with the collection agency to pay off what you can afford in exchange for the debt to be removed from your credit report. 

Every negotiation is different. But try a lowball offer to get started. For example, tell the collection agency you’re willing to pay 10% of what you owe. They might not go for that offer but could be willing to accept 30% to 50% of the debt. 

Of course, paying off your debt may not be possible for you right now. But if it’s within your power, paying off your debt is a worthwhile strategy to pursue. 

5. Pay Down Your Medical Debt to Under $500

Even if you can’t pay off your entire debt, paying down some of your debt can make a big difference to your credit score. As of 2023, medical debt in collections won’t be reported to credit bureaus if the outstanding amount is less than $500. 

Not sure how to pay off debt? Try the debt snowflake strategy or another payoff method that works for you. 


How to Avoid Medical Collections in the Future

Medical collections can impact your credit score. Although unexpected medical costs might be unavoidable, there are strategies you can employ to avoid medical collections in the future. 

Know Your Health Insurance Coverage

Health insurance is a complex financial product that can help you offset some medical costs. But understanding the ins and outs of your medical insurance can help you avoid unnecessarily large bills. 

With a deep understanding of your health insurance coverage, you can determine what your insurer will and will not cover. If you aren’t sure what should be covered, don’t hesitate to ask your insurer before heading to an appointment. 

Additionally, check with your provider to determine whether or not they are within your network. If not, it’s usually more affordable for your budget to opt for an in-network provider. 

Save on Medical Expenses

Medical expenses can add up quickly. A few ways to avoid outlandish medical costs include choosing the appropriate health insurance plan, sticking to in-network providers, and avoiding the emergency room when you can. 

Negotiate Medical Bills

When your insurance company doesn’t cover a big-ticket procedure, try negotiating the cost directly with your medical provider. 

Depending on the situation, the provider may be willing to offer a discounted rate. Some providers are willing to offer a discount to patients paying for the bill entirely out-of-pocket. 

If possible, work out the payment details ahead of time. Although it’s possible to negotiate after the procedure, asking in advance can help you nail down the true cost before committing to the service. 

In any case, don’t be afraid to ask for a discount. The worst that can happen is they say no. 

Ask for a Payment Plan

A payment plan breaks up the cost of treatment into more manageable payments. Although a payment plan stretches out your debt, it can help you avoid an unpaid medical collection on your credit report. 

In many cases, providers are willing to offer a payment plan to patients who can’t pay their bills all at once. Once enrolled, make on-time payments to avoid a ding on your credit history.

Ask for Medical Debt Forgiveness

Medical debt forgiveness isn’t an option for everyone. But in some cases, you may qualify for forgiveness. For example, many hospitals offer financial assistance programs to borrowers with low or moderate incomes. 

Additionally, several organizations and charities offer financial assistance for your medical bills. A few include HealthWell Foundation, PAN Foundation, and United Healthcare Children’s Foundation

Contact a Billing Advocate

Dealing with medical bills is stressful. And the unfortunate reality is that medical bills often come with other stressful situations, like serious medical issues. 

If you don’t have the time or energy to focus on your medical bills, a billing advocate can be a useful resource. A medical bill advocate can sort through your medical bills to find potential savings. They’ll handle the negotiation process for you and work to resolve the medical bill quickly. 

With their help, you could avoid having an unpaid medical bill make its way onto your credit report. 

Check Your Credit Report Regularly

When unpaid medical bills make it onto your credit report, time is of the essence. It’s important to check in with your credit report regularly to ensure there are no errors. 

If you do find an error, you can jump on it quickly. Luckily, it’s free to fix errors in your credit report. Remember, you can dispute mistakes of any kind on your credit report. If the mistakes are dragging your credit score down, DIY credit repair offers the solution you’ve been looking for. 


Final Word

Medical debt doesn’t impact your credit score right away. But if your unpaid medical bills become a medical collection account due to nonpayment, your credit score will suffer

When dealing with a medical emergency, it’s relatively easy for medical bills to fall through the cracks. If a medical collection account ends up on your credit report, take action to remove it before it significantly impacts your credit. 

I'm also including a bio here: Sarah Sharkey is a personal finance writer who enjoys helping people make better financial decisions. When not nerding out about money, Sarah enjoys traveling, hiking, and reading. You can connect with her on her blog Adventurous Adulting.
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