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How To Remove Medical Collections From Your Credit Report

Written by Mike Pearson
Updated August 10, 2022

Illnesses, injuries, and other types of health crises are disruptive to you and your loved ones. They put your whole life on hold as you take the time to heal and get back on your feet.

They also hold up work and your finances, which can take time to put back together. The latter can be especially harmful if you’re left with hefty medical bills.

If left unpaid, they eventually get sent to debt collection agencies, which gets added to your credit report, negatively impacting your credit score.

In this article, we’ll tell you why medical bills affect your credit and how to remove medical collections from your credit report.

How to Remove Medical Collections from Your Credit Report

The major portion of debts sought after by third-party collection agencies is overdue medical bills. So, if you have a bill that’s been sent to collections, you can breathe a sigh of relief knowing that you’re not alone.

The problem, however, is when you don’t pay an overdue bill or somehow forget about it. Then, after a year, your medical provider will turn the debt over to a collections agency.

From this point forward, any money you owe will be paid to this agency. Once they’re in charge of your debt, they’ll file a report detailing all the information concerning your medical debt. This report will show up on your credit report and stay there until you pay it in full.

Unfortunately, there’s nothing you can do to remove unpaid medical collections from your credit report before their 7-year time limit.

The silver lining is that credit reporting agencies are mandated by law to delete any negative information from your credit report as long as it’s reached the end of its assigned timeframe.

For medical collections is seven years. After that time, any information regarding this debt will be automatically removed from your report. 

Yet, say you paid the debt in full, but the bill is still showing up as a negative mark on your credit report. What do you do then?

Here are three ways to remove a fully paid medical collection debt bill from your credit report.

  1. Pay to Delete

If your insurance company pays the collection agency, then the credit bureaus will automatically remove the bill once the payment goes through.

On the other hand, if you’re the one paying the debt collection agency out of pocket, then it’s more likely that the bill will stay on your credit report for its entire seven years.

If that’s the case, you’ll have to send the collection agency a customized letter asking them to delete your medical collection. Then, in return for payment, they provide you with written confirmation that they intend to remove the debt from your credit report.

  1. Keep Your Debt Below $500

As of January 1, 2023, medical debts less than $500 in total won’t appear on your credit report.

This decision was made after the three credit bureaus discovered that most small debts were a one-time event that hadn’t recurred before or since. Therefore, they weren’t a liability to your credit score.

So, if you have any medical debt, try your best to pay it all off during the 12-month waiting period.

If you can’t, at least try to get it below $500 before the end of 2022. This way, you’ll be able to begin the new year with a clean credit report.

  1. Dispute Your Medical Collection Debt

Experts recommend that you make a yearly habit of requesting a free copy of your credit report. Then, read it over carefully to check that all the positive information has been successfully recorded. Although, what you should really be looking out for is any incorrect information.

Say you’ve paid off your medical debt, but it’s still listed as ‘open’ on your credit report. In this case, you have to correct it as quickly as possible to improve your credit score ratings.

While mistakes like this are quite rare, they do sometimes occur. So, if you suspect that the information on your credit report is inaccurate or fraudulent, you have the right to file a dispute.

This basically means that you need to show proof that the debt on your medical bills isn’t the same as that being reported on your credit report. For this to work, you’ll need to get in touch with each of the three credit reporting bureaus directly to ensure that your information has been correctly updated.

Both TransUnion and Equifax have set up their own process that allows consumers to call certain information on their credit reports into question.

As for Experian, they’ve set up three different methods of contact: via standard US mail, over the phone, or online.

Almost all disputes are resolved within 30 days. Once the dispute is settled, you can expect one of these four possible outcomes:

  • Remains: the medical provider has provided the credit bureaus with enough evidence to ascertain that the information is accurate, so the disputed medical collections will remain on your credit report until their time is legally up
  • Updated: all information on your credit report has been verified and updated
  • Processed: disputed medical collections have been updated or deleted from your report
  • Deleted: the disputed medical collections have been removed from your credit report

How Do Medical Collections Affect Your Credit Score?

Starting on June 1, 2022, you now have a full year to pay off your medical debt, as opposed to six months. After that, they get turned over to debt collection agencies.

The debt collector then writes a detailed report containing the name of the original creditor, which in your case is the medical provider. It’ll also have the contact information of the collection agency responsible for collecting your payment.

Once this report is filed, information about your late payments is then added to your credit report. This is when things can get a bit messy.

Your credit scores are created based on information gathered from your credit reports. There’s positive information that boosts your scores.

Those with a higher score definitely have a better chance because they’ve proven to be reliable with their money. In other words, the higher your score, the easier it’ll be to get the things you want.

Then, there’s the negative information.

Failure to pay your bills on time is considered negative information. It directly impacts your payment history, which is the most significant factor in determining your score.

Another determining factor is if you have medical debt in collections. Having medical collections means you haven’t been able to pay your bills in over a year, which is a major red flag.

If both these take a hit, so will your credit score.

A bad credit score can determine whether or not your credit applications get approved by lenders and credit card issuers.

That said, however, you can still get approved with a low score. Yet, it comes with a price. For example, lenders may require a security deposit or demand that a co-signer be present.

Also, credit card issuers may decide to increase your interest rates, force you to pay a deposit on utilities, or even pay more for car insurance. It’s their way of guaranteeing you’ll be more vigilant with your spending.

What Are Some Ways to Prevent Medical Collections on Your Credit Report?

The best way to avoid having to deal with medical collections in the first place is to pay your medical bills on time.

As we’ve mentioned, credit bureaus will give you a grace period of 365 days before adding any unpaid medical collections to your credit report. So, take this time to create a suitable payment plan with the medical provider.

You should also consult with your insurance company. Together, you can come up with a way to pay off as much debt as possible before the year is up.

In other words, if you’re able to pay off your debt within that timeframe, you can avoid having any medical collections show up on your credit report that can negatively impact your credit scores.

Here are some ways you can prevent medical collections from showing up on your credit report:

  • Set up a payment plan with your medical provider that gives you more time to pay
  • Understand your health insurance plan
  • Get the debt below $500 and keep it there
  • Consider getting a medical credit card
  • Check your credit report regularly for suspicious behavior
  • See if you qualify for an income-driven hardship plan

To Sum Up

When medical treatment is necessary, it can be scary when you don’t know how or when you’ll be able to pay for it. In addition, growing medical debts can leave you with bad credit scores that can put a strain on your finances.

Start by understanding how credit reports work. Then, find out what your options are when it comes to figuring out how to remove medical collections for your credit report, so you’re prepared if and when the time comes.

It pays to be a wise spender and always have a backup plan. This way, you’ll never be left with medical debt and a bad credit score ever again.

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Mike Pearson


Mike is a recognized credit expert and founder of Credit Takeoff. His credit advice has been featured in Investopedia, CreditCards.com, Bankrate, Huffpost, The Simple Dollar, Reader's Digest, LendingTree, and Quickbooks. Read more.