(WJW) — Medical debt has crippled the credit scores of millions of Americans, making it more of a challenge to do things like purchase a home or a car.
Two years into the pandemic that killed millions, three credit reporting agencies — Equifax, Experian and TransUnion — have come together to help eliminate medical debt from credit scores by up to a reported 70%.
The firms said they came to the decision following months of research.
“Medical collections debt often arises from unforeseen medical circumstances. These changes are another step we’re taking together to help people across the United States focus on their financial and personal wellbeing,” the CEO’s of the companies said in a joint statement.
The groups said that starting July 1, paid medical collection debt, which could stay on a credit report for up to seven years, is no longer going to appear. Then, starting “in the first half of 2023,” the big three are also leaving out any medical collection debt under $500. They also plan to extend the amount of time consumers have before the unpaid debt goes on their scores.
As of 2021, as financial education company debt.com reported, about half of all people in this country had some sort of medical debt, with more than half of those in debt owing at least $1,000.