Medical Bills? Your Credit Score Could Take a Whack

Health providers are using collection agencies more aggressively

By Neal Colgrass,  Newser Staff

Posted May 5, 2012 4:12 PM CDT | Updated May 5, 2012 4:41 PM CDT

(Newser) – That unpaid medical bill your insurance company promises to cover for you? Watch out, because even small medical bills are more likely to damage your credit score these days, the New York Times reports. A Texas man was surprised to find that an unpaid $200 ambulance bill (for his son's bike accident) knocked 100 points off his credit score, even though his insurance company had told him not to worry. “It wasn’t like I ignored it,” he said.

The problem: Health providers are turning to collection agencies more quickly, because medical bills are paying a greater percentage of providers' revenue. Patient advocates say that's unfair, as patients are covering a higher share of costs and medical bill paying is growing more complex. The Senate is even considering a bill to erase paid medical debts from credit reports. But credit agencies are crying foul, saying that "would severely undermine the integrity of a credit report and the resultant credit score. That is why it is called a history.”

Unpaid medical bills are increasingly likely to stain your credit score.
Unpaid medical bills are increasingly likely to stain your credit score.   (Shutterstock)
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