FinancingSenior Resources April 4, 2024

THE NO SURPRISES ACT: How it can help your credit score

A higher credit score helps a borrower get a lower interest rate. Sadly, one of the most common dings I’ve seen to credit is unpaid medical bills. 

How do unpaid medical bills effect my credit score?

Unpaid medical bills that go to collections show up on a credit report. What most people don’t realize is that even when paid off, the fact that the bill went to collections stays on the report. Over the years I’ve had several clients not be approved for a loan because of this.

Credit score ranges icon. Loan rating scale with levels from poor to excellent. Fico report dashboard with arrow isolated on white background. Financial capacity assessment. 

Can I remove an unpaid medical bill from my credit report?

There is hope. Alex Grimnes, president of Premier Credit Consulting, says one of the benefits of the No Surprises Act passed in 2022 is that once the medical bill is paid, the fact that it went to collections can be removed from a person’s credit report and no longer impact their credit score. Even if the bill was negotiated for a lesser amount, as long as it’s paid in full, it should be removed from a person’s credit report. 

It’s important to keep in mind that paid medical collections aren’t automatically removed from a person’s report. Grimnes says most often a person must dispute the report with the credit bureau to get the collections removed. A credit consulting business and possibly your lender could help with this.

How do I get started?

If you are trying to improve your credit score, a lender can also offer suggestions, such as which bills to pay off first. Or you may wish to contact a credit consulting business. For a fee they can design a plan to help you achieve your credit goals.

Please reach out if you need help getting started.