Medical debt can be a major concern for many individuals, especially when it appears on a credit report. Understanding how medical debt shows up on a credit report can help individuals in Oregon take action to protect their financial health.
How medical debt is reported
Medical debt typically appears on a credit report after it becomes past due. Once a bill goes unpaid for an extended period, usually 60 to 90 days, the medical provider or debt collector may report it to the credit bureaus. The debt shows up as a collection account, which can negatively impact a person’s credit score.
Impact of medical debt on your credit
Unlike credit card debt or personal loans, medical debt can have a different effect on credit scores. The three major credit bureaus — Equifax, Experian, and TransUnion — are required to remove medical debt from a credit report if it is paid or settled. This rule helps ensure that individuals do not suffer long-term consequences for medical expenses they’ve cleared up. However, unpaid medical bills may remain on a report for up to seven years.
Oregon law and medical debt
Oregon law provides some protection to individuals dealing with medical debt. Debt collectors in the state must follow strict rules when attempting to collect medical debt, including providing clear and accurate information about the debt. In addition, Oregon allows individuals to request a free credit report once every 12 months, helping them monitor any medical debts that may appear on their report.
Protecting your credit
To protect a credit report from the negative impact of medical debt, it’s important to address medical bills promptly. Setting up payment plans with medical providers, contacting credit bureaus to dispute inaccuracies, or filing for bankruptcy to discharge the debts can help maintain a positive credit score.
