Around June 2025, a new rule went into effect. Paid medical debt no longer appears on your credit report. And unpaid medical debt under $500? Also gone. It's the single biggest change to consumer credit in maybe a decade.
But here's what nobody tells you: medical debt over $500 that's unpaid still shows up. And it can still wreck your score.
I had a client — let's call her Patricia — who had a $2,800 emergency room bill from 2023. She thought she'd paid it. Turns out, there was a $700 lab fee that got sent to collections separately. She didn't know. Her credit score dropped from 710 to 620.
She came to me in early 2026, a year after the new law passed. The $700 collection was still on her report because it was under $500? No — it was over $500, so it stayed. But she'd paid it a year ago. Under the new rule, paid medical debt of any amount should be removed. The credit bureau hadn't updated.
We filed a dispute with all three bureaus. TransUnion removed it in two weeks. Equifax took a month. Experian... I forget how long, but they eventually did it. Patricia's score bounced back to 695. Not perfect, but way better.
Here's what you need to know about the 2026 rules (which are actually from 2025 but fully enforced now):
- Paid medical collections: gone. They must be deleted, not just marked as paid.
- Unpaid medical collections under $500: gone. You don't have to pay them. They just disappear.
- Unpaid medical collections over $500: stay for 7 years from the original delinquency date.
If you have medical debt on your credit report, check the amount and payment status. If it's paid, dispute it. If it's under $500, dispute it. If it's over $500 and unpaid, try to negotiate a settlement with the hospital. They often settle for 40-60% of the balance. Then once it's paid, dispute it for removal.
I'm not a lawyer, but I've seen this work dozens of times. Hospitals are more willing to settle medical debt than credit card debt because they know the collection chances are low. Use that.
Patricia ended up paying the $700 bill (which she'd already paid once — the lab had double-billed). She got a refund from the lab and a deletion from the credit bureau. She's now at 730. She's looking at buying a house next year.
I will keep posting updates on this. Check back soon.
P.S. Cooper somehow got into the trash while I was writing this. He ate a used paper towel. I'm not cleaning that up. It's my wife's turn. Wait, she's going to read this. Hi honey. I'll clean it up.
— J.W.