Medical Bills and Your Credit Score: What Changed

If you're worried about how medical bills might affect your credit score, there's good news: the rules have changed significantly in recent years. Thanks to voluntary changes by the three major credit bureaus in 2023, most medical debt no longer appears on credit reports. But the situation isn't simple — protections vary depending on where you live, how much you owe, and whether your debt has been paid. Here's everything you need to know as of 2026.

The Big Change: What Happened in 2023

In 2023, the three major credit bureaus — Equifax, Experian, and TransUnion — made sweeping voluntary changes to how medical debt is reported. These changes were the most significant shift in medical debt credit reporting in decades:

• Paid medical debt removed: All medical debt that has been paid is no longer included on credit reports, regardless of how long it took to pay
• Debt under $500 removed: Medical collections under $500 are no longer reported, even if unpaid
• 365-day waiting period: New medical debt won't appear on your credit report until at least one year after it goes to collections, giving you time to resolve billing disputes, negotiate, or arrange payment

These changes were voluntary — the bureaus chose to implement them without being required by law. According to the Consumer Financial Protection Bureau (CFPB), these changes removed an estimated 70% of medical debt tradelines from credit reports nationwide.

Current Rules: When Medical Debt Does and Doesn't Affect Your Credit (2026)

Understanding the current landscape requires knowing what's on and off your credit report right now.

Medical Debt That Does NOT Appear on Credit Reports

• Any medical debt that has been fully paid, regardless of amount
• Unpaid medical collections under $500
• Medical debt less than 365 days in collections
• Any medical debt if you live in one of the 15 states that ban it from credit reports

Medical Debt That CAN Still Appear on Credit Reports

• Unpaid medical collections of $500 or more that have been in collections for over 365 days
• Medical debt that has resulted in a court judgment (though these are increasingly rare on credit reports)

The CFPB Rule — What Happened

In January 2025, the Consumer Financial Protection Bureau (CFPB) finalized a landmark rule that would have banned all medical debt from credit reports nationwide. The rule would have:

• Prohibited credit bureaus from including any medical debt on credit reports
• Banned lenders from using medical debt information in credit decisions
• Applied to all medical debt regardless of amount or payment status

However, in July 2025, a federal court in the Eastern District of Texas vacated the rule, meaning it was struck down and never took effect. The court ruled that the CFPB exceeded its authority under the Fair Credit Reporting Act.

State Protections: 15 States That Ban Medical Debt on Credit Reports

While the federal CFPB rule was vacated, many states have enacted their own laws that go even further than the voluntary bureau changes. As of 2026, 15 states ban or significantly restrict medical debt from appearing on credit reports:

If you live in one of these states, medical debt cannot legally appear on your credit report regardless of the amount or payment status. For detailed information on state-level protections, see the Commonwealth Fund's state-by-state analysis and the National Consumer Law Center's tracker.

How to Check If Medical Debt Is on Your Credit Report

The first step is knowing what's currently on your credit report. Here's how to check:

Get Your Free Credit Reports

You're entitled to free weekly credit reports from all three bureaus through AnnualCreditReport.com. This is the only federally authorized source for free credit reports. You can also learn more about your rights at the FTC's free credit reports page and USA.gov.

What to Look For

• Check the "Collections" section of each report for medical accounts
• Look for any medical provider names or collection agency names you recognize
• Note the date each account was reported and the amount
• Verify whether the debt is paid or unpaid

Red Flags to Watch For

• Paid medical debt still showing on your report (should have been removed)
• Medical collections under $500 (should have been removed)
• Medical debt less than 365 days old in collections
• Any medical debt if you live in one of the 15 protected states
• Medical debt you don't recognize (could be identity theft or an error)

How to Dispute Medical Debt on Your Credit Report

If you find medical debt on your credit report that shouldn't be there, you have the right to dispute it. The credit bureaus are required to investigate and respond within 30 days (or 45 days if you provide additional information during the investigation).

Step-by-Step Dispute Process

1. Document the error: Take screenshots or save copies of the incorrect entries. Note why each item is wrong (paid, under $500, too recent, state law protection, etc.)
2. File disputes with each bureau: You must dispute with each bureau separately. You can file online, by mail, or by phone. Filing by mail with supporting documentation creates a paper trail.
3. Include supporting evidence: Attach proof of payment, state law references, or documentation showing the debt is under $500
4. Send via certified mail: If filing by mail, use certified mail with return receipt so you have proof the bureau received your dispute
5. Follow up: The bureau must respond within 30-45 days. If they don't remove the item, you can escalate to the CFPB

You can start the dispute process at AnnualCreditReport.com's dispute page.

Preventing Medical Bills from Reaching Your Credit

The best strategy is to address medical bills before they ever reach collections. Here's how:

1. Check Your Bills for Errors First

Studies show that up to 80% of medical bills contain errors. Before paying a large bill, review it carefully. Common errors include duplicate charges, unbundling violations, and charges for services not received. See our guide on top 10 medical billing errors to know what to look for.

2. Apply for Financial Assistance

Most hospitals are required to offer charity care or financial assistance programs. If you're struggling to pay, apply before the bill goes to collections. Our charity care eligibility guide can help you understand if you qualify.

3. Negotiate and Set Up Payment Plans

If you can't pay in full, contact the billing department to negotiate. Many hospitals will accept reduced payments or set up interest-free payment plans. Learn more in our guide on how to lower your medical bills.

4. Appeal Incorrect Bills

If you've found errors or believe charges are unfair, file a formal appeal. Our step-by-step medical bill appeal guide walks you through the entire process.

5. Communicate with Collectors

If a bill does go to collections, don't ignore it. Respond within the 365-day window before it can appear on your credit report. Read our guide on medical bills in collections for detailed strategies, and learn about what happens if you don't pay medical bills.

Frequently Asked Questions

Do medical bills affect my credit score?

It depends. Paid medical bills, bills under $500, and bills less than a year old in collections do not affect your credit score. Unpaid medical debt of $500 or more that has been in collections for over 365 days can still appear on your credit report and impact your score. If you live in one of the 15 states with medical debt credit reporting bans, no medical debt can affect your credit.

How much can medical debt hurt my credit score?

When medical debt does appear on your credit report, the impact varies. A single medical collection can lower your score by 25-100+ points depending on your overall credit profile. However, newer credit scoring models (like FICO 9 and VantageScore 4.0) give less weight to medical collections than other types of debt.

How long does medical debt stay on my credit report?

If medical debt makes it onto your credit report, it can stay for up to 7 years from the date the account first became delinquent. However, its impact on your score decreases over time. And remember — if you pay it off, it should be removed immediately under the 2023 bureau changes.

Will paying off medical debt improve my credit score?

Yes. Under the 2023 bureau changes, paid medical debt is removed from your credit report entirely. Once removed, your score should improve, often significantly. This is a major change from the old system, where paid collections remained on your report for years.

Can hospitals send me to collections without warning?

Nonprofit hospitals are required to make reasonable efforts to inform you about financial assistance options before sending bills to collections. Most hospitals must wait at least 120-180 days before referring debt to collections. If a hospital sent you to collections without proper notice, you may have grounds to dispute the debt.

What if I'm currently in a dispute over a medical bill?

While you're disputing a bill with the hospital or your insurance company, the debt generally should not be sent to collections. If it is, make sure to inform the collection agency of the active dispute. The 365-day clock before credit reporting gives you additional protection during this period.

Does the CFPB rule banning all medical debt from credit reports apply?

No. The CFPB finalized this rule in January 2025, but it was vacated (struck down) by a federal court in July 2025. The rule never took effect. Current protections come from the 2023 voluntary bureau changes and individual state laws.

The Bottom Line

The credit reporting landscape for medical debt has improved dramatically. Most people with medical bills will never see them on their credit report, thanks to the 2023 bureau changes that removed paid debt and debt under $500. If you live in one of the 15 states with additional protections, you have even stronger safeguards.

But protections only work if you know about them. Take these steps today:

You don't have to navigate medical billing alone. Health Bill Central can help you analyze your bills for errors, check your eligibility for financial assistance, and generate professional appeal letters — all in one place.