Here are six things to know about the changes.
1. Experian, Equifax and TransUnion will incorporate a 180-day waiting period prior to disclosing medical debt on a credit report to resolve disputes with insurers and delays in payment.
2. Once the medical debt is paid by an insurer, the credit bureaus will remove it from the consumer’s credit report.
3. The changes resulted from a 2015 consumer protection settlement between the State of New York and the three national credit reporting agencies.
4. Credit scoring companies, such as VantageScore and FICO, have been using newer models that differentiate between medical and nonmedical debt. This differentiation results in a smaller penalty for individuals with medical debt in collections.
5. Medical expenses account for over 50 percent of debt on consumer credit reports.
6. According to a 2014 report by the federal Consumer Financial Protection Bureau, 43 million Americans have medical debt that is harming their credit.
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