Is Your Credit Report Protected From Medical Debt

According to the Federal Register, as of October 28, 2025, the question of whether your credit report will be protected from medical debt appears to be getting a resounding "no" from the Trump administration. The Federal Register points out that an amendment to the Fair Credit Reporting Act comes as an attempt to make credit reporting more standard across the country, replacing a Biden-era ruling that gave states the ability to ban the inclusion of medical debt on consumer credit reports. The Fair Credit Reporting Act exists to protect consumer credit information reported to agencies like credit bureaus, medical information companies, and tenant screening services.

Supporting the Biden-era ruling, credit reporting agencies Equifax, Experian, and TransUnion made an announcement in April 2023 that medical debt under $500 would be removed from consumer credit reports, removing 70% of the total medical collection debt from consumer credit files. This is significant considering that, as per the Commonwealth Fund, the primary cause of bankruptcy for American households is debt tied to medical bills. According to the Kaiser Family Foundation (KFF), medical debt affects 100 million Americans, and around 25% of adults with medical debt carry balances of over $5,000. As per the Consumer Financial Protection Bureau (CFPB) via Congress.gov, it appears that some of these bills are often overinflated, which demonstrates the importance of always asking for an itemized bill before paying your medical bills.

This change effectively removes the power to exempt medical debts from consumers' credit reports from the states, and hands the sole authority to do so to the Federal branch. Prior to the Trump administration's amendment to the Fair Credit Reporting Act, Oregon, Washington, California, Minnesota, Colorado, Maryland, New York, and several other states had passed laws to prevent consumers' credit from being impacted by medical bills. Although the CFPB, via Congress.gov, estimated Americans owed a total of $88 billion in medical bills on their consumer credit reports in 2021, the KFF reports that amount had grown to $220 billion by 2024.

Bad credit affects you in more ways than you realize: It can impact your ability to be approved for a mortgage, purchase a vehicle, and possibly even get a job. Another concern for anyone with medical debt, particularly those in arrears, is that the CFPB reported to Congress that 15% of collection complaints from consumers in 2021 were based on inaccurate credit report filings, often taking anywhere from 30 to 45 days for a credit reporting agency to investigate. Since your wages can be garnished to pay for medical bills, this ruling may also directly affect your income which, combined with Trump's wage garnishment for delinquent student loans, threatens to make life difficult for Americans juggling both.