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Does Medical Debt Affect Your Credit Score? The 2026 Answer

Posted by Century Support Services on May 11, 2026

Medical Debt Affect Your Credit Score

The answer changed significantly between 2022 and 2025. Three separate actions by the credit bureaus and a federal regulatory rule shifted what appears on credit reports, what does not, and how scoring models treat what remains. If you are working from information that is more than two years old, you may have an inaccurate picture of where things stand.

This article covers what changed, what still affects your score, what debt settlement does to medical debt on your report, and what to do if medical debt is currently weighing on your credit.

Key Takeaways

  • In 2022, Equifax, Experian, and TransUnion voluntarily committed to removing paid medical collections and collections under $500 from credit reports, with changes taking effect through 2023.
  • In January 2025, the CFPB finalized a rule that would prohibit the inclusion of all medical debt on consumer credit reports. This rule may be subject to legal or regulatory challenge. Verify current status with the CFPB.
  • Despite these changes, unpaid medical collections above $500 may still appear on your credit report depending on the current rule implementation.
  • Enrolling medical debt in a debt settlement program will negatively affect your credit during the program, consistent with the impact of other unsecured debt settlements.
  • Century Support Services makes no representation about credit score outcomes resulting from enrollment in a debt settlement program.

What Changed Between 2022 And 2025

Understanding the current state of medical debt on credit reports requires knowing three separate events.

July 2022: Credit bureaus announce voluntary changes. Equifax, Experian, and TransUnion announced that, effective July 1, 2022, they would no longer include paid medical collection debt on credit reports. They also announced an extension of the grace period before unpaid medical collections appear, from 6 months to 12 months from the date of first delinquency.

March 2023: Removal of medical collections under $500. Beginning March 30, 2023, the three major bureaus removed medical collection accounts under $500 from consumer credit reports and stopped including such accounts in future reporting.

January 2025: CFPB finalizes broader rule. The Consumer Financial Protection Bureau finalized a rule that would ban all medical debt from consumer credit reports, regardless of balance amount or payment status. The rule was published in the Federal Register and set to take effect. As of the time this article was prepared, the rule faced potential challenges, and its current implementation status should be verified directly with the CFPB before being relied upon for financial planning.

What Medical Debt Still Appears On Your Credit Report

Based on the changes confirmed through 2023:

Does not appear:

  • Medical collections that have been paid, regardless of the original balance
  • Medical collections with an original balance under $500
  • Medical debt in collections for less than 12 months (the 12-month grace period allows time to resolve with insurance before reporting begins)

May still appear, depending on current rule implementation:

  • Unpaid medical collections above $500 that have been in collections for more than 12 months

Practical steps to check your own report: Pull your free credit report from AnnualCreditReport.com, the only federally authorized source under the Fair Credit Reporting Act. Review each bureau separately (Equifax, Experian, TransUnion), as reporting is not identical across all three. Identify any medical collection accounts listed and compare the balance to the $500 threshold that was in effect through 2025.

If a medical collection that should have been removed remains on your report based on confirmed voluntary changes, you have the right to dispute it directly with the credit bureau. The CFPB’s guide to disputing credit report errors covers the dispute process in detail.

How Medical Collections Affect Your Score When They Appear

When an unpaid medical collection does appear on your credit report, it functions as a negative tradeline. The effect on your score depends on your overall credit profile, including the length and strength of your credit history, your payment history on other accounts, your current utilization, and the number of other accounts in good standing.

Older collections carry less weight than recent ones. A medical collection that is 4 years old affects your score less than one that entered your report 6 months ago, because credit scoring models apply diminishing penalties to older negative items.

FICO and VantageScore both treat medical collections differently from credit card collections in their more recent scoring models. VantageScore 4.0 excludes medical collections entirely. FICO 10T and FICO 9 weigh medical collections less heavily than other collection types. However, many lenders, particularly mortgage lenders, still use older scoring models (FICO 8 or earlier) that do not differentiate between medical and non-medical collections.

If you are planning to apply for a mortgage, understanding which scoring model your lender uses matters. The Federal Housing Finance Agency announced a transition to FICO 10T and VantageScore 4.0 for conforming mortgages, which would reduce the credit score impact of medical debt. Consult with your lender directly about the specific model used for your application.

What Debt Settlement Does To Medical Debt On Your Report

Enrolling medical debt in a structured debt settlement program affects your credit in the same way as settling any other unsecured debt.

When you stop making direct payments to creditors as part of a settlement program, those accounts become delinquent. Delinquency is reported to the credit bureaus and negatively affects your score. As accounts are settled, they are updated to reflect the settled status, which remains on your report for seven years from the date of first delinquency.

The credit impact of settlement is a trade-off that should be weighed against the financial impact of continuing to carry high-interest balances with no realistic path to full repayment. For people whose medical debt has combined with credit card or personal loan balances to create a situation where minimum payments consume most of their monthly income, that trade-off often looks different from what it appears at first.

Century Support Services makes no representation about credit score outcomes resulting from enrollment in a debt settlement program. Individual results vary significantly based on your starting credit profile, the accounts enrolled, the timing of settlements, and other factors. For more on how debt settlement affects your credit, see How Does Debt Settlement Impact Credit.

Practical Steps If Medical Debt Is Affecting Your Credit

Step 1: Pull your credit report from all three bureaus. Use AnnualCreditReport.com for free access. Review each separately.

Step 2: Identify any medical collections. Note the balance, date of first delinquency, and payment status.

Step 3: Compare to confirmed removal criteria. If the collection is paid, or if the balance is under $500, and it still appears on your report, it should have been removed under the 2022 to 2023 voluntary changes. File a dispute with the relevant bureau.

Step 4: Verify current CFPB rule status. If the 2025 rule is in effect, all medical debt should have been removed. Check consumerfinance.gov for current implementation status.

Step 5: Assess the full picture of your debt. If medical debt is part of a larger unsecured debt situation, address the underlying balance, not just the credit report entry. A free consultation with a Certified Debt Specialist gives you a complete picture of what debt resolution would look like for your specific accounts.

Also, read:

 

Address the Underlying Debt, Not Just The Credit Report

Removing a medical collection from your credit report does not reduce what you owe. If you are carrying $10,000 or more in unsecured medical debt, a free consultation with a Certified Debt Specialist gives you a clear picture of what structured resolution looks like for your specific situation, before you make any decision.

Get a Free Debt Consultation: No Fees, No Commitment
Century has helped more than 330,000 people address unsecured debt. Every consultation is free, requires no commitment, and involves no fees of any kind until a debt is settled and you approve it. Call 855-417-6648 or start your free consultation at centuryss.com. 

Results vary. Not all debts or consumers qualify. Debt settlement will negatively affect your credit during the program. Fees are success-based and vary by state.

 

FAQ

Does unpaid medical debt affect your credit score in 2026?

Under the credit bureau voluntary changes effective through 2023, unpaid medical collections under $500 no longer appear on credit reports. The CFPB finalized a rule in January 2025 to remove all medical debt. Whether and how that rule is currently implemented should be verified directly with the CFPB. If unpaid collections above $500 remain on your report, they can affect your score depending on the scoring model used.

How long does medical debt stay on your credit report?

Under the Fair Credit Reporting Act, collection accounts can remain on your credit report for seven years from the date of first delinquency. The credit bureau voluntary changes and the 2025 CFPB rule both reduced which accounts actually appear, but for those that do, the seven-year period still applies.

Does paying off medical debt improve your credit score?

Under the 2022 voluntary changes, paid medical collections are removed from credit reports entirely. Removing a negative tradeline can improve your score, though the degree depends on your overall credit profile. Century makes no representation about credit score outcomes.

Will medical debt prevent me from getting a mortgage?

It depends on the mortgage type and the credit scoring model the lender uses. Some newer models (FICO 9, FICO 10T, VantageScore 4.0) weight medical collections less heavily or exclude them. Many mortgage lenders still use FICO 8 or earlier models. Speak directly with your lender about how medical collections are treated in their underwriting.

Does debt settlement remove medical debt from my credit report?

Settling a medical debt does not remove it from your credit report. The tradeline will update to reflect the settled status, which is better than an active unpaid collection, but will remain on the report for 7 years from the date of first delinquency. During the settlement program, your accounts will show delinquency, which will negatively affect your credit.

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