CHAMPAIGN, Ill. (WCIA) – If you have hospital bills stacking up, three credit reporting agencies are making a change that may improve your finances. Medical debt less than $500 will no longer appear on credit reports run by Experian, Equifax or TransUnion.
To Champaign County Health Care Consumers Executive Director Claudia Lennhoff, this is a great step forward – but she doesn’t think it goes far enough.
The Consumer Financial Protection Bureau said while most individual medical collections tradelines are removed from credit reports, a majority of reported medical collections in terms of dollar amounts will still appear. Lennhoff hopes that eventually, medical debt won’t be reported at all. That’s because she says it’s often involuntary. Lennhoff works with clients who felt they didn’t have a choice but to get medical attention, but didn’t have the means to pay for it.
“It’s not like somebody who’s going to purchase a television that maybe they don’t really need,” Lennhoff said. “Maybe they want a new television, they go and purchase it and they fall behind on their payments or don’t make their payments. That’s very, very different than healthcare.”
When those debts show up on credit reports, Lennhoff says that can wreck consumers’ ability to take the next step in their lives, like rent an apartment.
Lennhoff also said in this community, healthcare providers are less likely to report medical debt to credit bureaus, but it can happen. If you need help, Champaign County Health Care Consumers can connect you with financial assistance programs.