A couple days ago, the New York State Attorney General (AG), Eric T. Schneiderman, announced the settlement of a lawsuit with the top three credit reporting firms: Equifax, Experian, and TransUnion to:
• Help improve the accuracy of credit reports.
• Increase the ease of resolving errors on credit reports.
• Protect consumers from unfair harm to their credit due to medical debt.
The AG went on to say that one of the top complaints received by his office is bad debt collection practices. So, let’s try to avoid getting into that situation. However, when it comes to medical debt, sometimes the trouble is unavoidable as we get sick or get injured unexpectedly. With that in mind I wanted to highlight how the settlement can help you protect your good credit even if you have medical debt.
1. Medical debt will not be reported on your credit report for 180 days – this gives you more time to resolve insurance disputes or questions and get the bill figured out and hopefully paid by insurance.
2. Removal right away of delinquencies that have been paid by insurance – Normally when you pay a collection account it is reported as paid. It will continue to report as a derogatory paid item. With this settlement, medical debt that’s on your credit report but has since been paid by insurance will be removed from your credit report as a derogatory item.
Regarding medical debt, I encourage all of my clients and you too, to follow these guidelines when it comes to medical bills:
• You need to pay close attention to medical bills and any documentation from your insurance company.
• Make sure you understand what insurance is willing to pay and why or why not. If you don’t understand, pick up the phone and call your insurance provider.
• Make sure that the insurance payment reported to you equals the medical bill from the provider. If it doesn’t you need to investigate right away. I often see medical collections on credit reports as a result of medical bills that should have been paid by insurance but were mis-coded by doctors’ offices or mis-understood by insurance companies.
So, make a point to stay on top of medical debt and you will save your credit report from lots of damage. The AG’s office says that over half of all collections on credit reports are medical debt, so this is a huge problem for many New Yorkers. Remember, I’m here to help you avoid having medical debt become a problem for you too.
If you have any questions on this subject, please let me know. I’m here to help you understand what this settlement means for you.
For more information, read the press release and the settlement at: http://www.ag.ny.gov/press-release/ag-schneiderman-announces-groundbreaking-consumer-protection-settlement-three-national
Source: Huff Post