Medical Bills and Your Credit Score

By Alexandra Scicchitano

     Medical bills are a thing everyone eventually has to deal with. But especially now with the COVID-19 pandemic, unexpected medical bills can pop up more likely than not. If this happens to you, how will your credit score be affected? 

     Even when meeting your deductible, your insurance, on average according to HealthCare, will only cover between 60% to 90% of the expenses. Which can lead you to a lot of debt from necessary procedures your insurance won’t cover. 

     62% of bankruptcies in 2020 were due to medical expenses, while 72% of those filed had some form of health insurance, according to Legaljobs.

     As long as you’re paying your medical bills, they will not show up on your credit report. However, according to Experian, once you stop paying for over 60 days, it can be sold to a collection agency and then appear on your credit report and affect your credit score.

     There is a 180-day grace period of, if the bill was sent to collections, before it will show up on your credit report. So, although it won’t have a direct impact on your credit score right away, in the long run it, it will have an impact on your score. 

     According to Experian, quick action is key to preventing a medical bill from damaging your credit score. As soon as you get a medical bill, review it to make sure it's accurate

     You don’t want to be behind on your medical bills, so the obvious course of action is to pay your bill continuously and on time until the bill if fully paid. But sometimes, paying a medical bill isn’t in the cards for this month’s bills. Losing a job or having to spend it on more important matters can have an impact on whether this bill can be paid on time or not. 

     According to Experian, if the bill is not covered by your insurance and you're afraid you'll have trouble paying it, talk to your health care provider to see if you can work out an alternative solution. Another thing Experian recommends is, hiring a medical billing advocate who can help you talk to your health care provider on getting you on a payment plan. They can save you time and money.

     So, although medical bills can be unexpected and costly, there are still things that can be done to ensure you can pay them on time and keep your credit score up and your life a little less stressful. 

     D.A.L.S. Credit Solutions & Notary wants to help you keep your credit score up, even if you have medical bills to pay to collections. Let us help you start on the way to paying your medical bills back and keep from your credit score taking a hit from them.