Do Medical Bills Affect Your Credit?
10 Min Read | Last updated: June 16, 2025
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Understand how medical debt affects your credit, see how unpaid medical bills impact your scores, and take steps to help protect your credit report.
At-A-Glance
- Nearly half of Americans struggle to pay their medical bills.
- Eventually, larger unpaid medical bills may be sent to debt collection agencies.
- Previously, medical debt sent to collections wouldn’t affect your credit if you paid it off within 180 days. As of 2022, that grace period was extended to one year.
Serious illnesses and injuries can be hard enough without the added financial stress of medical bills that make matters more challenging. According to Kaiser Family Foundation (KFF) research, nearly half of American adults said they found it financially difficult to pay their medical bills.1 Meanwhile, almost 15 million Americans have unpaid medical debt, contributing to a nationwide medical debt that the Consumer Financial Protection Bureau conservatively estimated to be at least $88 billion in early 2022.2
Understanding how medical bills are handled by doctors and medical facilities and the rules about when unpaid medical bills can show up on your credit report may help you strategically prevent medical debt from negatively affecting your credit.
Medical Bills and Your Credit: Billing Timelines
Doctors and healthcare facilities may not directly report bill payment history to the three main credit bureaus. Instead, if you or your insurer doesn’t pay the bill, the health care provider may turn your bill over to a debt collection agency. This action can take anywhere from 60 to 180 days after the billing date.3
Medical Bills and Your Credit Report: The One-Year Grace Period
Normally, if you have any unpaid debt turned over to a collection agency, it counts as an adverse item on your credit report that can create negative impacts for your score.
But the major credit bureaus treat medical debt differently from typical consumer debt.4 Previously, the bureaus agreed that unpaid medical bills sent to a debt collection agency would be removed from or left out of your credit report for 180 days. But in 2022, that grace period was extended to one full year.5
That gives individuals more time to navigate the world of insurance billing and pay off the balance. Bills paid within the grace period window will not impact your credit report or your credit score.
Less Impact on Credit Report for Medical Debt under $500
In April 2023, the three credit bureaus, Experian®, TransUnion® and Equifax®, rolled out a new reporting system that no longer included unpaid medical debt below $500 on credit reports.5 Paying off larger bills as soon as possible or negotiating payment plans with your healthcare provider might help make sure medical debt doesn’t end up at a collection agency. But even if a medical bill is sent to collections, you may have additional time to pay it off before your medical debt negatively affects your credit score.
Can You Pay Medical Bills With a Credit Card?
Credit cards may offer a quick way to cover costs, but they can also add to your debt when mismanaged or with a high annual percentage rate (APR), which calculates how much you’ll pay to borrow money each year. While you can use a credit card to pay medical bills, weigh the pros and cons before charging healthcare expenses.6 You may want to explore other options first, too, like negotiating a lower bill, creating a payment plan, or requesting financial assistance.
Pros of using a credit card for medical debt:
- Immediate payment to avoid late fees or collections
- 0% APR Credit Cards means you could pay less (or no) interest during the introductory offer period
- Potential for earning cash back or rewards on medical expenses
Cons of credit cards for medical debt:
- High interest rates if the balance isn’t paid off quickly
- Medical debt may turn into long-term credit card debt
- The possibility for negative credit score impacts due to a decrease in your total percentage of available credit
Can Medical Debt Affect Your Credit Score?
The impact on your credit score often can depend on healthcare provider practices, the debt collection agency, and the credit scoring model used.
FICO Score 8 is currently the most widely used scoring model.7 The good news is the newer FICO Scores 9 and 10 assess medical debt differently from an ordinary collections account. FICO Score 9 specifically treats medical debt in collections less harshly than other types of debt sent to a collection agency.8
Keep Track of Your Credit When Facing Medical Debt
Get in the habit of checking your credit reports regularly as you deal with medical debt. The major credit bureaus offer free weekly reports online, and you can also consult American Express’s MyCredit Guide™ to spot and dispute any outdated or incorrect medical collections. With the recent changes to reporting rules, some medical debts should no longer appear, so take a look to guarantee accuracy.
Help Prevent Medical Debt From Negatively Impacting Your Credit
In addition to monitoring your credit report, another way to avoid negative credit impacts is to keep your medical bills from being handed over to a collection agency. The following tips might help:
Make sure you’re not charged for unavoidable out-of-network care.
If you have health insurance, choosing doctors and facilities in your network might save you money. Though individuals don’t always have a choice of facility or provider, a relatively new federal law aims to offer financial relief from any unexpected medical bills associated with receiving unplanned care from an out-of-network doctor or facility. The law went into effect in January 2022.9
This law prohibits you from being billed extra when you cannot choose your provider during emergencies or receive treatment from a provider you didn’t know was outside your plan’s network. You’re also protected if you get care from a doctor or hospital within your health insurance plan’s network, but somewhere along the line, an out-of-network doctor provides care. For instance, an anesthesiologist or radiologist you have no role in choosing may be out of network.
Build up savings to cover medical bills.
Every health insurance plan has a maximum out-of-pocket (OOP) cost you may be liable for in a calendar year. Find out your plan’s maximum OOP and aim to tuck away at least twice that much in an emergency savings account should you experience ongoing illness or injury.
Be proactive if you can’t pay the bill in full.
Don’t take a head-in-the-sand approach if you can’t cover the bill with one quick payment. It’s important to ask your healthcare provider if they’ll agree to a payment plan arrangement. This way, you can pay the bill over a few months instead of a lump sum.
Consider saving in a Health Savings Account.
You may be eligible to set aside money in a Health Savings Account (HSA) if you or your employer has a high-deductible health plan (HDHP). The average annual deductible for an HSA-qualified, single-coverage HDHP is nearly $2,500 and $4,600 for family coverage.10 It makes sense to consider opening an HSA only if you already have enough set aside in savings to cover the higher deductible you must pay before coverage kicks in.
Frequently Asked Questions
While larger medical bills can still negatively impact scores, lenders might use FICO Score models that may not penalize medical debt as harshly.
Minimum payment amounts for your medical bills vary by healthcare provider and collection agency. You can try to negotiate how much you pay each month.
The Takeaway
If an unpaid medical bill is sent to a collection agency, you have additional time to pay it off before it negatively affects your credit. To avoid that hit to your credit score, hatch a plan today to cover future medical costs.
1 “Americans’ Challenges with Health Care Costs,” KFF
2 “CFPB Finds 15 Million Americans Have Medical Bills on Their Credit Reports,” Consumer Financial Protection Bureau (CFPB)
3,4,5 “Does medical debt affect your credit score?,” CNBC - select
6 “Should you pay off medical debts with a credit card?,” CNBC - select
7,8 “FICO® Scores Versions,” myFICO
9 “Surprise billing & protecting consumers,” CMS.gov - Centers for Medicare & Medicaid Services
10 “2023 Employer Health Benefits Survey,” KFF
Carla Fried is a freelance journalist who has spent her entire career specializing in personal finance. Her work has appeared in The New York Times, Money, CNBC.com, and Consumer Reports, among many other media outlets.
All Credit Intel content is written by freelance authors and commissioned and paid for by American Express.
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