If your medical debt is not being removed from credit reports, here's what you can do.

In a few months, medical debt may be removed from your credit report, relieving its burden on your credit score.

Before you celebrate the good news, ensure that your debt meets the criteria.

Starting July 1, the three credit reporting companies, including TransUnion, will remove any medical debts that were sent to debt collectors and eventually paid off.

Consumers will have more time to resolve unpaid medical debt, as it will no longer appear on credit reports after a year, instead of the previous 6 months.

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In the first half of 2023, medical collection debt under $500 will not be included on credit reports by credit reporting firms.

Medical debt can negatively impact an otherwise good credit score, as stated by Ted Rossman, senior industry analyst at Bankrate and CreditCards.com.

Occasionally, it's a straightforward insurance error, or it could be a critical situation.

If you have a medical debt in collections, your credit score could increase by about 100 points once it is removed, according to Rossman. However, the impact will be lower if you have other credit mistakes.

The interest rate you'll pay on loans or credit cards is determined by your credit score, which also affects your ability to obtain a home mortgage.

A 2018 report by the National Association of Professional Background Screeners reveals that almost half of employers check some or all of their candidates' credit reports.

Check your credit reports

Verify if any paid medical debt has been removed from your credit reports after July 1. Due to the Covid-19 pandemic, you are eligible to receive one free credit report per week from each of the major credit reporting agencies until the end of the year.

The reports are available through AnnualCreditReport.com.

It is advised to consistently check your credit report, as stated by Chi Chi Wu, staff attorney at the National Consumer Law Center.

In 2021, a Consumer Reports investigation found that more than one-third of Americans discovered errors on their credit reports. However, the Consumer Data Industry Association, which represents credit scoring companies, disputed the accuracy of the Consumer Reports story, claiming it was "completely false and misleading."

In contrast, a 2012 study by the Federal Trade Commission revealed that 25% of Americans had errors on their credit reports.

File a dispute

If a medical debt that should have been removed remains on your credit report, you can file a dispute with each credit reporting company to have it removed. Here are the links for each company:

Rewritten sentence: The debt collector has been harassing me with constant calls and letters, despite my attempts to settle the medical debt.

If a debt has been paid off but still shows as unpaid, it can make the situation more complex.

Wu advised that it's best to send a dispute via certified mail, typically.

She said that the debt was satisfied and it should be reported to both the credit reporting firms and the debt collector. (Source: https://www.ftc.gov/tips-advice/consumer-alerts-and-advisories/disputing-errors-your-credit-report)

If your dispute is rejected by credit reporting agencies, it's common to have to dispute the debt multiple times. To increase your chances of success, make sure to include additional information in your communication.

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