(Gray News) – The credit reporting agencies Equifax, Experian, and TransUnion announced on Friday that they will change how medical debt is reported.
Beginning July 1, paid medical debt will no longer be included on credit reports, according to a TransUnion press release.
The release also indicated that medical debts under $500 will not be reported in the first half of 2023.
In addition, the period before a medical debt is reported will increase from six months to one year. The release said this is to give consumers time to work with insurance providers and medical care providers to address their debt.
TransUnion said the changes will remove almost 70% of medical debt tradelines from consumer credit reports. A tradeline is information about a person’s account that is sent, usually on a regular basis, to a consumer reporting agency, the U.S. Consumer Financial Protection Bureau says.
Around two-thirds of medical debts stem from a one-time or short-term medical expense, according to the Kaiser Family Foundation.
The agencies cited this, along with the COVID-19 pandemic and the ongoing reviews, as reasons for the new measure, saying it allows consumers “to focus on their well-being and personal recovery.”
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