Medical Debt To Be Erased From Credit Reports

One very big advantage to having a personal injury attorney with you to help you in your case, is that your attorney can help you manage the medical bills and expenses that may pile up, while you are waiting for your case to settle or go to trial. But not everybody is that savvy—some people go without attorneys, or get attorneys too late, allowing medical bills to go into default, or into collections.

Bills Can Go Into Collections

Accident victims who don’t get attorneys to help them often have double trouble—the obvious medical problems from injuries sustained in accidents, but also, the mounting financial stress of the medical bills that are coming in, or the collection calls they are getting, demanding payment of medical bills they cannot pay. And usually, collections agencies don’t want to hear “I’m getting a settlement, so can you just hold the balance?”

Balances on Credit Reports to be Erased

Well, there is some good news on the horizon, not just for accident victims, but for anybody with medical debt: The nation’s three largest credit reporting agencies are minimizing or completely eliminating the reporting of medical related debt. The debt will still be owed to the medical providers, if they are unpaid–however, the mark on the consumers’ credit that says that the debt hasn’t been paid, will be erased.

Allowing medical debt to be reported to consumers credit, and thus lower their credit score, has long been very controversial.

Unlike someone who puts luxury items or vacations on credit cards, people who have medical problems and amass medical debt, do not incur that debt voluntarily. Someone who gets into a car accident, or who falls, or who develops cancer, and then needs medical treatment they cannot pay for, is certainly not irresponsible—and credit is supposed to be a measure of someone’s financial responsibility.

The three credit reporting agencies, starting in the summer, will begin removing negative credit items from consumers’ credit that are incurred as a result of unpaid medical debts. This should increase the score of millions of consumers, allowing them to have better credit scores, and better access to credit.

Additionally, in the future, the credit reporting agencies will only report unpaid, delinquent medical debts, after those debts have been in collections for a year.

How Do Medical Bills Get Paid in a Personal Injury Case?

Your personal injury attorney will work with your medical providers, and may even sign documents promising that your medical providers will get some of what they are owed, when your case eventually settles or goes to trial, so long as it does settle and so long as you do win your case.

Your attorney will do this for all your medical providers and companies that paid on your behalf, including private doctors, hospitals, or government agencies like Medicaid or Medicare.

Those documents, and your personal injury attorneys’ coordination with these medical providers will help make sure that your credit isn’t damaged, while you are waiting for your case to conclude.

Don’t handle your personal injury case on your own.  Call the Knoxville personal injury lawyers at Fox Farley Willis Burnette, PLLC, today.

Sources:

seekingalpha.com/news/3814966-experian-equifax-transunion-set-to-erase-most-medical-debt-from-credit-reports

businesswire.com/news/home/20220318005244/en/Equifax-Experian-and-TransUnion-Support-U.S.-Consumers-With-Changes-to-Medical-Collection-Debt-Reporting