By Doug Aldeen
Sunday morning bathroom read (Happy 4th of July): Slowly but surely (more like a glacial pace) the python like grip of the industrial medical sick complex is loosening… .
If a provider can no longer impair your credit, is a cash rate the new, new thing? Effective July 1, 2022, credit bureau’s are required to:
“…It’s not yet clear if the credit bureaus will immediately purge all paid medical debt from their reports on Friday, or if the removal process would simply begin that day. Neither TransUnion nor the Consumer Data Industry Association, a lobbying group that represents the big three credit bureaus, was able to clarify when questioned by Money.
Another change taking effect Friday: Unpaid medical bills that are sent to collections will not post to your credit report for a full year — up from six months. The increase is intended to give you more time to negotiate your bills before they start affecting your credit, the bureaus said.
In the first half of 2023, the three credit bureaus will also stop including medical collections debt of $500 or less, and the cutoff may increase. According to the CFPB, most medical debt tradelines are less than $500, meaning this move alone would be a major boon for millions of Americans.
Collectively, these changes will bar 70% of all medical collections debt from appearing on credit reports, the credit bureaus estimate. That would account for more than $60 billion of debt.
Meanwhile, the CFPB is determining whether ANY UNPAID medical billing data should be shown on credit reports. Under Director Rohit Chopra’s leadership, the CFPB has been highly critical of how medical debt affects credit.