How Long Will Unpaid Medical Bills Affect Your Credit Score?

Unpaid medical bills. Before the Affordable Care Act, many more people were uninsured than there are today. The ACA is far from perfect, and costs have risen in many parts of the country. People have all kinds of complaints, but the truth remains, for people who would otherwise have been uninsured, Obamacare makes emergency care a lot more affordable. Unfortunately, “a lot more affordable” doesn’t mean cheap, and lots of people are still saddled with medical debts they can’t afford to pay.


This puts people in a tricky situation. Medical bills on credit reports can be scary to see. Depending on the severity of the debt, you may see your credit score drop a lot or a little. This is because the amount of the debt has a lot to do with how financially vulnerable you seem to creditors and credit reporting agencies. If you have a bill of a few thousands dollars, it looks to these entities like you can’t afford to pay this amount of money. They can’t look into your bank account, so they have to assume that you’re broke.


This may not be the case. Many Americans would be able to pay this kind of bill, but only just barely. Some of them don’t want to totally impoverish themselves, just because they had to go to the hospital for some emergency that was outside of their control. These people are left with only a couple of options. They can decide to pay the bill, of course, but it would be recommended that they do so only after careful negotiation with the hospital, well before the account is sold to collections.


That conversation would be handled with a hospital’s billing department. They will be used to chasing after payments they are unlikely to receive. If you talk to them and offer to pay only a portion of the bill, they might be willing to discount the bill considerably in order to get back a portion of what they are owed. This isn’t exactly honest – it’s better to pay your debts. But if you are in a situation where you can’t afford to pay, try to work out a deal with the hospital before the debt has a chance to damage your credit score.


If your credit report has already taken the hit, and the account is in collections, try the same negotiating tactic with the collections agents (don’t worry! You don’t have to find them. They’ll contact you!). If all else fails and you can’t afford to pay, you can simply take the hit on your credit report and wait the seven years for it to disappear. This always happens with credit report events. Nothing will affect your score forever, but big events like this can make your score take quite the dive. For certain people, it won’t be worth the drop in score to wait out the debt, and they’d better find a way to pay it. Whatever you choose, try to keep these events off your credit history by resolving them before the payment is late or sold.