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Medical debt: Should you pay it, and does it matter?

On Behalf of | Aug 19, 2021 | Medical Debt

When you receive a medical bill that is thousands of dollars, the shock of the price tag alone may make you set aside the bill for another time. Putting off paying will only end up having the bill go to collections.

Once a bill goes to collections, the collectors will call and may attempt to settle the debt. At that point, it’s a good idea to take a look at your credit report. Interestingly, some kinds of medical debt will not impact your credit score if the agency hasn’t reported it.

Will a hospital send your debt to collections?

It is likely that the hospital will send your debt to collections if you don’t pay anything. If you can pay something, even if it’s not as much as they hospital would like, they may decide not to send your debt to collections since you are willing to pay. This is why it’s smart to negotiate directly with the hospital if you can.

Did you know that almost no medical providers or hospitals go out of their way to report your debt to the credit bureau? As long as your debt is with the hospital itself, your credit may be better protected.

When do medical debts get reported to the credit bureau?

Usually, medical debts get reported after a hospital or medical provider sends the debt to the debt collection agency. The agency then can decide to report the debt to the credit bureau, though not all of them will.

If you get a notice from a collection agency, it’s smart to get in touch and to see if you can negotiate a fair settlement. If you can, you may still be able to protect your credit. Even if your debt has been reported, paying it off and informing the credit bureau will help you get your credit score restored, at least in part.

Medical debt is a tricky kind of debt to deal with when you’re looking at your credit score. If you’re struggling to pay back what you owe, you may want to consider looking into bankruptcy or other debt relief measures to help resolve the debt.


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