Credit Score Articles

How Unpaid Medical Bills Can Ruin Your Credit Score

Photo of patient sitting on a medical gurney.

When a trip to the hospital leaves you with medical bills pushing triple-digits, you may find yourself strapped with unexpected debt. Although your medical bill will not appear on your credit report, overdue medical expenses can still wreak havoc on your credit. So, before you decide to skip out on paying, learn how unpaid medical bills can ruin your credit score.

Unpaid Medical Bills Appear on Your Credit Report

Similar to utility bills, medical bills and related balances will not appear on your credit report. However, when hospital fees go unpaid, the debt will likely be turned over to a collections agency, which appears on your report and has a very negative influence on your credit score. 

Low Balances on Medical Expenses Still Affect Your Credit Score

Whether you owe $1.00 or $10,000, unpaid medical bills will tarnish your credit report if the balance owed is sent to a collections agency. Consider contacting the collections agency and stick to the agreed upon repayment plan to avoid dragging down your credit score any further.

Will the Balance Be Removed Once I Pay the Debt?

It is important to note that paying your medical bills in full will not boost your credit score, as the negative item is not considered a credit-building account. The unpaid medical bills reported to the credit bureaus may remain in your credit history for about seven years once it is paid off. But, take heart; the impact the negative item will have on your credit score will diminish over time, so focus on paying off the debt and preventing further legal action.

Unpaid medical bills can ruin your credit score and put a financial strain on your wallet, so keep the lines of communication open with all parties involved. Exploring all of your repayment options and working to negotiate your debt with the hospital or collections agency will help you chip away at your bills while minimizing the damage overdue medical expenses can have on your credit report long after your health is on the mend!