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The Medical Debt Relief Act and How It Can Affect Your Credit Score ? Finance ? Debt Management

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The recent economic crisis made the basic healthcare needs of some average income Americans unaffordable. During the past decade, there was a 100% increase in family insurance premium costs and that made wages even more insufficient for a family to keep afloat. Add to that the number of people who lost their job and you get millions of Americans who cannot afford to get hospitalized without any form of insurance or financial aid. Medical debt is a growing problem of American workers in the country and if this cannot be stopped, their credit scores will be greatly affected which in return can severely jeopardize future credit prospects.

There are a lot of reasons why people fall into medical debt; they simply do not ask questions to their insurer and health care providers. We cannot blame them though because admission in a hospital is usually already troublesome, asking for question to unwilling people can be distressing to the patients and to their families. But you have to know all the medical jargons being presented in your medical bills, the hospital can put so many hidden charges and they often make mistakes when charging patients. Ask for your itemized bill and recall if you have ever exploited the products and services displayed in the bill. If not, contact the hospital immediately and demand that they remove the specific product/service which you have not used. This can significantly help reduce your medical bill and decrease the risk of non-payment.

Non-payment or even underpayment of medical bills can be a reason why it is forwarded to the collection agency. Once your medical reports have been forwarded to one of these collection agencies, your credit scores will be adversely affected. A low credit score can disqualify you for some loan applications which can severely jeopardize your future financial needs.

Mary Jo Kilroy, an Ohio Congresswoman took the initiative of solving this pressing problem. The Medical Debt Relief Act is an amendment to the Fair Credit Reporting Act. It is expected to be passed in the Congress next year. The new bill will mandate all credit companies to remove medical debt reports within 30 days after making a full payment. It also requires credit bureaus to stop factoring paid medical debt for credit score computations as it was already been paid.

The Medical Debt Relief Act cannot solve America

Source: http://www.waystoreducedebt.net/the-medical-debt-relief-act-and-how-it-can-affect-your-credit-score/

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