Here's What Happens to Your Credit Score When You Pay a Medical Bill Late

Medical debt is a huge problem in the U.S. A recent report from the Kaiser Family Foundation found that roughly 23 million Americans have medical debt, including 3 million consumers with a balance of over $10,000.

Paying a medical bill late has the potential to cause damage to your credit score, the same way being late with a loan payment or credit card bill could do the same. But recent changes to credit reporting have made it so you get a little more leeway when it comes to a late medical bill. 

A positive development

Normally, any time a bill of yours is more than 30 days late, the entity you owe money to can report that tardiness to the credit bureaus. From there, your credit score has the potential to take a dive. 

But things work a little differently when it comes to medical bills. Changes to credit reporting that were implemented earlier this year have made it so that medical debts under $500 are not included on credit reports. So if you're late paying a medical bill worth $300, it won't land on your credit report and won't cause a drop in your score.

Even if you have a medical bill that's higher, being late won't necessarily hurt your credit score right away. The three primary credit bureaus -- Experian, TransUnion, and Equifax -- give consumers a 365-day period to resolve medical debt from the time it's incurred before any delinquencies appear on credit reports. 

So, let's say you owe $1,000 for a medical bill and it goes to collections after you fail to pay it for a period of time. If you manage to settle that debt eight months later, your credit score won't be impacted.

Now, you should know that larger medical debts that remain unresolved after a year can land on your credit report and cause damage to your credit score. But once they're paid off, they're removed from your credit report. So while you might have temporary damage if you're very late paying a medical bill, you won't necessarily have long-term damage.

Do what you can to keep your credit score in good shape

The higher your credit score, the easier it becomes to borrow money when you need to, and at an affordable rate. So it's best to do what you can to keep your credit score in solid shape, and that generally means making a point to pay all of your bills on time.

If you fall behind on a medical bill and are late paying, you may not face damage to your credit score right away, if at all. But the same leeway doesn't exist for other late payments. So make sure to always pay your credit card bill on time (even if you can only swing the minimum monthly payment), and keep up with personal loan payments as necessary. 

And if you ever have a situation where you can't make an on-time payment due to a lack of funds, reach out to the entity you owe money to and see if there's a way to work something out so your credit score won't be at risk.